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article imageOp-Ed: The increasing burden of Greek austerity

By Katerina Nikolas     Dec 18, 2011 in World
Athens - Increasing austerity measures and rising prices are pushing Greece to the limit. Prime Minister Lucas Papademos, the former banker who is running Greece without being elected, promised no new tax rises this week, just as new price increases are announced.
An official at the Greek Public Power Corporation (DEI) has announced that the first tranche of the emergency property tax, hastily introduced in September, has thus far raised 650 million euros in tax. It may appear surprising that the electricity supplier made the announcement regarding tax collection but the company was responsible for raising the unpopular tax through electricity bills.
People who could not, or would not, pay the emergency tax, were faced with their electricity supply simply being cut off. The next wave of bills will be the second tax demand of several hundred euros, due at this year end. Unsurprisingly, the demand for electricity has fallen as austerity bites and budgets are tightened evermore. Due to this DEI has reported losses this quarter: their response is to increase the cost of electricity between 10 and 19 percent on 1. Jan. 2012., according to Athens News. The exact amount has not been determined yet but should be announced before Christmas by the Environment Minister. This in spite of Lucas Papademos saying no new tax hikes in 2012.
Local taxes incidentally are collected via the electricity bills too, and if the government allows a price rise of 19 percent it can only be perceived as a new tax. Still the whole venture has proved that millions of wasted euros could be saved by abolishing the corrupt and inefficient tax office and simply passing all responsibility for tax collection onto the electricity company, though that would result in another strike.
According to Trading Economics the rate of Greek inflation last reported in November was 2.9 percent. Quite what figures were manipulated to come up with this incredibly low figure is questionable. Central heating oil rose from last winter's price of 68 cents a litre to the current price of 98 cents, with the imposition of extra tax announced in September. Naturally sales of central heating oil have plummeted as Greek people remain in unheated homes.
Incredibly, I heard this weekend that people are attempting to sell their cars for a fraction of their worth, due to an inability to afford the annual road tax which must be paid prior to Dec. 31. Those who fail to pay on time see the bill doubled in the new year. Some are even trying to give them away rather than have them seized. However, even a free car needs taxing, insuring, and the transfer of ownership papers which can entail at least one, if not two days, dealing with the layers of bureaucracy involved in the paperwork with a myriad of different stamps required.
The picture of feckless, lazy Greeks, depicted in the German media is simply not the case. Successive governments have mishandled Greek finances and played the nepotism game allowing a bloated public sector and layers of unnecessary bureaucracy. Instead of finding new ways to encourage productivity the government persists in its policy of austerity, leaving citizens in dire financial straits which will prompt further recession.
This opinion article was written by an independent writer. The opinions and views expressed herein are those of the author and are not necessarily intended to reflect those of
More about Greek inflation, electiricity price increases, central heating oil, High taxes, Greek property tax
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