Emergency tax cuts extended into 2021

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All emergency tax reductions and the permanent tax breaks ratified before the onset of the pandemic will apply in 2021, with the cheap state loans program also running into next year, Finance Minister Christos Staikouras assured on Saturday.

The Deposit To Be Returned scheme will continue in 2021 after this month’s fourth phase and next month’s fifth, Staikouras told Skai television. He also reported that 19,830 applications were submitted in the first few hours of operation of the fourth phase’s platform on Friday, resulting in loans of 155 million euros to businesses. The disbursement will take place today, with payments to the next batch of applicants due at the end of the week.

He added that in the third phase of the scheme, €3.4 billion in loans were issued to 150,000 enterprises, mainly on islands.

The Deposit To Be Returned, said Staikouras, is only one of several economic support measures introduced by the government. “We handed out €24 billion in 2020 and another €7.5 will be distributed in 2021, so there is a sum of €31-€32 billion, roughly as much as we will receive from the Next Generation EU fund in the coming years,” he said. “These are support measures that will be funded through the country’s cash reserves, with European resources that have already started flowing (the SURE program), through our market forays at very low borrowing costs and through EU resources to be disbursed over the first half of 2021.”

Staikouras added that the reduced value-added tax will continue to apply through next April, as will “all permanent tax cuts voted and implemented before the health crisis.” He added that an amendment is due to be tabled about the compensation of landlords, “which will not be taxed or confiscated.”

Staikouras did not rule out an extension to the 50% compensation to property owners who have seen their rental revenues slashed by 40% due to the coronavirus measures. He said it will depend on the state of the economy.

The finance minister also said that “any obligations suspended due to the pandemic will go for payment after April 2021 in 12 or 24 installments, with low or no interest at all.

“Anyone who has been left out of the debt arrangements may enter the framework, concerning arrears dating since November 2019 or later,” he said, adding that banks will extend loan arrangements to 2021.

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