17 December 2017
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RE Property in Greece unfavorably taxed

04 May 09 | Stratos Paradias
Stratos Paradias

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The Hellenic Property federation has repeatedly stressed the fact that, in Greece, when discussing annual taxation, we tend to forget other types of ownership and focus on urban real estate. We tend to do this, despite the fact that many other types of ownership are hugely favored in terms of taxation. Bank deposits, for example, are taxed on interest and not on the deposited capital, but property is taxed on value, as well as any profits derived from it.

The Hellenic Property federation has repeatedly stressed the fact that, in Greece, when discussing annual taxation, we tend to forget other types of ownership and focus on urban real estate. We tend to do this, despite the fact that many other types of ownership are hugely favored in terms of taxation. Bank deposits, for example, are taxed on interest and not on the deposited capital, but property is taxed on value, as well as any profits derived from it.

The government will reportedly issue new property taxes these days and so the Hellenic Property Federation has decided to create a comparative table which clearly shows the way the ten most important types of ownership are taxed in terms of income, ownership transfer, possession, surplus value, and "Pothen Esches" (the law demanding owners to establish where the money for the ownership came from).

The data collected in this table show that urban property ownership is the only type of private property which is taxed by all the possible ways it could be taxed, using coefficients in many cases unfavorable when compared to those applied to other types of ownership.

Urban real estate property is the only type of property taxed annually by further taxes, such as the Real Estate Tax (TAP) and the recently implemented one-off property tax (ETAK).

It is worth noting that business and financial activities are excluded by the "Pothen Esches" tax, which aims only at real estate and car ownership. Amongst the measures proposed by the Hellenic Property Federation in order to boost the rapidly declining property sector, was the temporary exception of property ownership from "Pothen Esches", for which we were criticised for harbouring tax evasion. We now have to wonder why it is morally correct to purchase stocks, bonds, company shares and mutual fund shares without the need to explain the origin of the money paid, but morally unethical to apply the same rule to the property sector which is so much in need of support.

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