Ministry lines up new taxes for property owners, bondholders
by Prokopis Hatzinikolaou,, 24 August 2015

Changes to the ENFIA property tax and levies on securities and overseas properties are being discussed by the government's economic team to increase public revenue in 2016.

Among several new measures, the Ministry of Finance is considering reducing the ENFIA tax in 2016 for owners with lower property values and making up the shortfall in the government's 3.3-billion-euro target through new tax measures.

Taxpayers in Greece with property abroad will from 2016 be called to pay property tax to the Greek state. Those who already pay such tax in the country where the property is located will be exempt as long as they submit the relevant documents to the Greek tax authorities on an annual basis.

Also in the works are plans from 2016 to make holders of foreign bonds - e.g. German or American government bonds - pay a flat tax to the Greek authorities. A senior Finance Ministry official explained that "it is not possible that someone who buys a 200,000-euro property pays tax on it and someone who invested in, for example, German government bonds pays no tax at all to the Greek government."

The new plans are set to be discussed between Greece and its lenders immediately after the upcoming snap elections in order to amend the relevant legislations of the draft law in time for October.

Starting from the end of October, the ENFIA property tax will be paid in five installments, with the last payable in late February 2016.

The 20 percent discount for empty properties and those not connected to the electricity grid will remain.

The exemption for properties belonging to the Greek National Tourism Organization (GNTO) will be abolished, generating an additional 1.5 million euros.

In November, a committee will be set up to adjust the objective values of properties. The team will be composed of lawyers, notaries, representatives of municipalities and tax inspectors who will be invited by the end of the year to set the new objective values. The aim is for the property tax rate to move in line with objective property values. Annual adjustments to the tax rate will be made as necessary.