ATHENS - Prime Minister Kyriakos Mitsotakis on Saturday presented a wide-ranging tax and income package designed to raise household incomes and provide relief for businesses, pensioners and the self-employed. The measures carry a fiscal price tag of €2.2 billion for 2027, roughly equivalent to one percent of Greece's gross domestic product.
The announced measures include an annual bonus of €400 for pensioners and €500 for public sector employees. Low-income farmers and low-income families with three children will receive zero income tax treatment. The plan also reduces the advance tax payment required from self-employed individuals and small enterprises.
In addition to tax changes, the government revealed plans to increase the statutory minimum salary to €950 per month this year and to raise it further to €1,000 in 2028. There will also be a 0.5 percentage-point reduction in pension contribution rates.
The center-right administration that returned to power in 2023 with 40.5% of the vote has made raising incomes a central pledge. While its position remains ahead in opinion polls, reported support has declined to below 30% amid a prolonged cost-of-living crisis and allegations of corruption.
Officials say stronger-than-expected public finances provide the room to enact the package. Greece's economy is expanding at an annual rate of 2%, outperforming the euro zone average, and the government expects a primary surplus of about 4% of GDP this year - nearly double its earlier forecast. That improved fiscal position is cited as creating the necessary space to finance the new measures without further strain.
The announcements cover a mix of one-off payments and structural changes to taxes and wages intended to affect households across the income distribution as well as small businesses and the self-employed. The government framed the moves as consistent with its campaign commitment to lift incomes while pointing to the country's stronger fiscal performance as the enabling factor.
Summary
The Greek prime minister unveiled a set of income-support and tax-relief measures costing €2.2 billion in 2027, including pension and public servant bonuses, minimum wage increases to €950 now and €1,000 in 2028, tax exemptions for certain low-income farmers and families with three children, and a cut to advance tax payments for small businesses and the self-employed. The government says higher-than-expected fiscal surplus and 2% GDP growth provide room to fund the package.