Greece on Sunday slapped a new tax on real estate to plug a 2011 budget hole and please international lenders


Greece slaps new tax on property to cut deficit

Harry Papachristou

Reuters US Online Report Business News

Sept 11, 2011 13:10 EDT

THESSALONIKI, Greece (Reuters) – Greece on Sunday slapped a new tax on real estate to plug a 2011 budget hole, please international lenders and secure a key new loan tranche as concerns mounted in Europe over its euro zone membership.

The European Commission welcomed the measure, just days before EU and IMF inspectors arrive in Athens to hear how the government plans to overcome delays and missed fiscal targets before approving an 8-billion-euro tranche from its 110-billion-euro bailout, key to Greece’s survival.

Finance Minister Evangelos Venizelos said the cabinet agreed the measure to raise about 2 billion euros missing from the government’s coffers and to meet the 2011 budget deficit target, estimated at around 8.1 percent of GDP.

“It’s the only measure that can be applied immediately and produce results quickly because it does not depend on the tax-collecting mechanism,” he told reporters, adding the levy would be collected through electricity bills.

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