The government is using the €800 million surplus for increases in pensions, tax cuts and new targeted measures to support households and businesses.
The government’s economic policy enters a phase of reallocating fiscal space, as the latest surplus figures create a significant scope for additional interventions in the real economy. The strengthened fiscal outcome paves the way for a new package of measures combining targeted support for vulnerable groups, permanent interventions in the tax framework and temporary relief in critical sectors such as energy and the cost of production. The focus is on low-pensioners, families with increased needs and specific professional sectors affected by inflationary pressures, while the planned measures aim both to provide immediate relief to disposable income and to gradually strengthen economic stability.
Specifically, a surplus higher than the target and a “return” of fiscal space to citizens in a targeted manner was announced by Minister of National Economy and Finance Kyriakos Pierrakakis,as ERTnews notes.gr.
Driven by the surplus
The final figures are announced tomorrow, paving the way for a new round of interventions to benefit households and businesses by the Prime Minister himself.
The “vehicle” for decision-making is the so-called 2025 surplus to be announced on Wednesday.
“The majority of the measures that the government has announced so far are of a permanent nature and indeed most of the measures that we have given are not bonuses, most of them – there are some bonuses – and even important ones are tax cuts, that is our philosophy. Sometimes you have to take some extraordinary decisions and take, take extraordinary measures. So ,let’s have some patience,” government spokesman Pavlos Marinakis told Parapolitika 90.1 FM.
The interventions
According to estimates, the amount of the surplus for this year is close to 800 million euros, of which 300 million euros are related to the measures already announced. The remaining €500 million will come from the measures already announced. 500 million will finance the new package of measures, which will include an extension of the existing ones and new measures such as:
* Increase of the permanent financial aid of 250 euros to low pensioners and expansion of the number of beneficiaries
* Tax reduction
* Extension by at least one month of the:
– subsidy at the pump for diesel
– 15% subsidy for producers for the purchase of fertilizers
Measures for those in real need
Kyriakos Pierrakakis, speaking to the ambassadors of the E.He spoke of measures targeted at those in real need.
“This creates, based on European fiscal rules, an additional fiscal space and we plan to use this space to Greek citizens, especially those who are most in need at this time in a targeted way,” the Economy Minister said.
The activation of the support measures is aimed at absorbing inflationary pressures in a number of goods and in the energy sector.
At the same time, the government is keeping “reserves” as even the most experienced analysts cannot be sure of the outcome of the Middle East conflict.
Talk of tax cuts
Kyriakos Pierrakakis had said on ERT that the bar for the surplus would be revised upwards. The original forecast was for 3.7%. Now the estimates, which remain to be confirmed in tomorrow’s ELSTAT and Eurostat announcements, say it will be well above 4.4%.
The philosophy is very specific. The extra dowry of 500 million euros will be used to increase one-off aid, such as the subsidy on diesel fuel – the 20 cents – and on the other hand to increase permanent measures, such as for example the 250 euro allowance given to low pensioners.
According to reports, there will be more beneficiaries.
It is worth noting that there is also a discussion about tax cuts. It remains to be seen how all of this will be reflected in the final announcements, which may have an element of energy.
