Finance Minister: reserves are exhausted, we will not reduce taxes

Finance Minister Christos Staikuras spoke about the situation in the economy, saying that overly optimistic forecasts should not be trusted, since the situation in the economy is worse than forecast last fall.

As the minister noted, “before the elections, we promised that the country would move forward when we had financial stability, which would be ensured through tax cuts. Tax cuts create jobs by attracting investment. ” However, he added that at this stage, the government has exhausted budgetary reserves (due to the pandemic), but will seek more tax cuts in the future.

Regarding the forecasts for the development of the Greek economy, he said that “we are more conservative than the assessments of institutions”, saying that this year the country’s economy will grow by 3.6%.

This forecast is based, he stressed, on the growth of tourism compared to last year, which will reach about 45% of income in 2019 compared to 26% in 2020, as well as on a very large increase in deposits, which in the past year and a half exceeded 30 billion euros, and from funds that will come from the Recovery Fund in the third quarter of this year.

However, he added that the deficit will reach 7% of GDP because the isolation lasted longer and the measures taken to address the effects of the pandemic eventually reached 15.9 billion euros out of the 7.5 billion euros originally calculated.

Finally, to the question “when will we return to surpluses?” The minister replied that there will be a fiscal balance in 2022, then primary surpluses will amount to 2% of GDP in 2023 and 2.9% of GDP in 2024.

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