May 18, 2017 / 10:04 PM / in 2 months

FACTBOX-Greece legislates measures to wrap up bailout review, get more aid

3 Min Read

    May 18 (Reuters) - Greek lawmakers approved an omnibus bill
late on Thursday, required by the country's official lenders to
conclude a crucial bailout review and release more aid to the
debt-ridden country.             
    The legislation contains more austerity measures, including
pension cuts and a higher tax burden that will go into effect in
2019-20 to ensure a primary budget surplus, excluding debt
servicing outlays, of 3.5 percent of gross domestic product.
    Athens needs the bailout funds to repay 7.5 billion euros
($8.35 billion) of debt maturing in July.
    The bill also includes relief measures that will kick in
only if fiscal targets are met. They include cuts in corporate
and individual income tax rates, and reductions in other
unpopular levies.
    The following are the main measures in the bill:
    
    Austerity measures:
    - The income tax exemption is reduced to 5,600-5,700 euros
from 8,600 euros to generate revenues of about 1.9 billion
euros. The lower threshold will mean an increased tax burden of
about 650 euros for taxpayers.
    - Up to 18 percent cuts in main and supplementary pensions
and freezing of benefits thereafter until 2022. The cuts will
result in savings of 2.3 billion euros.
    
    Asset sales
    - Sale of stakes in railways, Thessaloniki port, Athens
International Airport, Hellenic Petroleum and real estate assets
to generate targeted privatisation revenue of 2.15 billion euros
this year and 2.07 billion euros in 2018. 
    - Main electricity producer Public Power Corp (PPC)
          must reduce its market share by 46 percentage points
by the end of 2019 to reach a targeted 50 percent share. 

    Relief measures, contingent on meeting fiscal targets:
    - Reduction of corporate tax rate to 26 percent from 29
percent.
    - Ending a so-called solidarity tax for annual incomes up to
30,000 euros.
    - Cut in the personal income tax rate to 20 percent from 22
percent. 
    - Slight reduction of the annual tax on real estate holding,
provided it does not exceed 700 euros.
    - Increased benefits for low income groups, including
support for rental costs up to 1,000 euros annually, increased 
benefits for parents with children, subsidies for child care and
lower costs for medicines.
 ($1 = 0.8981 euro)

 (Reporting by George Georgiopoulos and Lefteris Papadimas;
Editing by Bill Trott)
  

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