Beleaguered Tsipras govt now eyes amendment to abolish pre-legislated reduction in tax-free income threshold

Wednesday, 05 June 2019 12:04
ΑΠΕ ΜΠΕ/Andrea Bonetti
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The leftist Tsipras government appears intent, following an announcement by the prime minister himself on Tuesday evening, on tabling a draft amendment in Parliament ahead of the July 7 snap election that will overturn a pre-legislated reduction in the annual tax-free income threshold.

The austerity measure was negotiated and ratified in 2017 as part of a "tax tsunami" by the outgoing government to fulfill annual primary budget surplus targets mandated by Greece's European institutional creditors. It is scheduled to be implemented on Jan. 1, 2020, but has over the past year or so been at a center of speculation of being overturned.

Alexis Tsipras appeared on a live current affairs program on the state broadcaster ERT on Tuesday evening, with only the program's host lobbing questions at the former. Among others, he promised that the measure will be overturned, similar to a social security harmonization (downwards) that his government avoided - with creditors' acquiescence - on Jan. 1, 2019. While promising that the same will occur with the tax-free income threshold before it is set for implementation, the now looming July 7 general election and the fact that Tsipras' hard left SYRIZA party suffered consecutive defeats (May 26 and June 2) in European Parliament and local government races brought the issue to the forefront.

MPs comprising the slim government majority in Parliament last month sidestepped a draft amendment tabled by the main opposition New Democracy (ND) party that would have abolished the upcoming measure, which aims to lower the tax-free annual income threshold to roughly 5,500 euros.

Now, the political "shoe is on the other foot", with beleaguered SYRIZA set to bring the issue to Parliament, but with ND and other opposition parties declaring that they will abstain from Parliament sessions and deliberations. The latter consider the current Tsipras government as a mere "lame duck" administration, demanding a caretaker government be sworn in until the July 7 election.

Additionally, opposition parties have warned that they will not be party to a "fiesta", as they charged, of pre-election amendments and riders tabled for alleged petty partisan expediencies.

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