Chr. Staikouras: Total revenue of € 9.4 million from tax incentive arrangements

For “great interest” from investors, foreign retirees and employees that has created the integrated legal framework for providing tax incentives, instituted by the Ministry of Finance, with successive legislation, from December 2019 to February 2021, the Minister of Finance speaks. Christos Staikouras.

It is a framework that includes a quadrilateral of interventions, which, in the approximately 2.5 years of gradual implementation, has brought significant revenues to public funds and multiple benefits for our country, notes Mr. Staikouras:

1st The beginning was made with Law 4646/2019 (article 5A of the Income Tax Code (law 4172/2013) which introduced in Greece the institution of “non-resident” (Non-Dom), a framework of tax incentives aimed at attracting new tax residents abroad – investors, who, transferring their tax residence in Greece and making significant investments in our country, they benefit – for a period of up to 15 years – from alternative taxation of income of foreign origin.

2nd. Then Law 4714/2020 (article 5B of the Income Tax Code (n.4172 / 2013) extended the alternative income taxation to foreign retirees, who transfer their tax residence to our country, by applying a rate of 7% for foreign income.

3rd In addition, with Law 4758/2020 (article 5C of the Income Tax Code (n.4172 / 2013) tax incentives were introduced to attract foreign workers and the self-employed, but also Greeks who left the country during the financial crisis, to move their tax residence and operate professionally Specifically, for the aforementioned categories of natural persons – employees or self-employed – a 50% exemption from income tax and the special solidarity contribution was introduced, for a period of up to 7 years, provided that a new employee is employed or starts a new activity. .

This is a measure that contributes significantly to the effort of the so-called “brain gain”, ie the return to our homeland from abroad human resources with a high level of knowledge, professional skills and abilities.

4ον. The “quartet” of interventions was completed in February 2021, with Law 4778/2021which established clear and transparent rules for the establishment and operation of special purpose family property management companies (Family offices), taking into account international best tax practices.

Although the implementation of the tax incentive framework for attracting new tax residents and investments in Greece started under extremely unfavorable conditions, due to the health crisis, its immediate efficiency is already reflected in the data collected by the Independent during their implementation. Public Revenue Authority, which are presented in detail below.

First results from the application of the incentives

In the 2.5 years of implementation of the regulation for tax incentives aimed at attracting new tax residents abroad – investors (Article 5A of the Income Tax Code), have already flowed into the public coffers total revenues of 9.4 million euros, with final approval applications of 75 investors and 23 relatives from 21 countries for the tax years 2020 and 2021.

Given that this year, so far, another 27 applications have been submitted, it is estimated that the total number of investors attracted by the measure will exceed 100 in the near future, while investments in real estate or business or securities or shares or shares in companies with based in Greece (based on estimates for new entrants) will amount to at least 50 million euros within three years.

In addition, significant revenues are generated due to the large number of applications for the measure both for foreign retirees (Article 5B CCA) and for employees and the self-employed (5C CCA). Of these policies, the indirect multiplier benefits for our country are remarkable, such as strengthening the economy, stimulating investment and boosting employment.

In particular, regarding the alternative taxation of foreign pensioners, 335 applications from at least 21 countries have been approved since 2020, and 85 are being processed.

Regarding the inclusion in the special taxation of employees or self-employed, the process started in 2021 and 1,689 applications have already been submitted, while 1,232 have already been approved.

According to the data for the first period of implementation of the new provisions, despite the unfavorable situation of the pandemic, the energy crisis and the Russian invasion of Ukraine, the impact of the new tax incentives is extremely encouraging.

Taxation is, in fact, an extremely useful tool for achieving growth and investment goals, in addition to securing public revenues.

Greece, moving forward with a plan, vision and confidence, has recovered strongly from the health crisis, is developing and is open to attracting investment and human capital. In this way, we create the appropriate conditions for the creation of many and good new jobs, for the provision of opportunities to the Greeks, the young men and women, who are in our homeland or will return to it “.