Greece approves fresh round of austerity measures of €1.8bn in tax increases
The Greek parliament has approved a fresh round of austerity incorporating €1.8bn (£1.3bn) in tax increases – widely regarded as the most punitive yet – amid hopes the move will lead to much-needed debt relief when eurozone finance ministers meet this week.
Alexis Tsipras, the prime minister, mustered the support of 152 of his 153 deputies on Sunday to vote through policies that many have previously rejected.
Addressing the 300-seat house during the heated three-day debate that preceded the ballot, Giorgos Dimaras, an MP in Tsipras’s leftwing party, said he was appalled at being forced to support measures he had spent a lifetime opposing.
“I am in mourning,” he said. “This is what can only be called wretchedness.”
As parliamentarians had prepared to vote, large crowds of protestors took to the streets with Panaghiotis Lafazanis, a former minister who broke ranks with Syriza to form the Popular Unity party, taking the demonstration to the foot of the building itself where he unfurled a giant banner proclaiming: “The memorandum will not pass.”
The belt-tightening legislation, outlined in a 7,500-page omnibus bill, includes measures that range from the taxation of coffee and luxury goods to the creation of a new privatisation fund in charge of real estate assets for the next 99 years. Under the stewardship of EU officials, the body will oversee the sale of about 71,500 pieces of prime public property in what will amount to collateral for the €250bn in bailout loans Greece has received since 2010.
“They are with the exception of the Acropolis selling everything under the sun,” said Anna Asimakopoulou, the shadow minister for development and competitiveness. “We are giving up everything.”
The multi-bill, which also foresees VAT being raised from 23% to 24%, is part of a package of increases in tax and excise duties expected to yield an extra €1.8bn in revenue. Earlier this month, Tsipras’s leftist-led coalition endorsed pension cuts that were similarly part of an array reforms amounting to €5.4bn, or 3% of GDP.
At the behest of the EU and International Monetary Fund, the government has agreed to adopt tighter austerity in the form of an automatic fiscal brake – referred to as “the cutter” in the Greek media – if fiscal targets are missed.
