ENFIA property tax takes centre stage in Greek politics

Santorini, Greece
Santorini, Greece

Greece’s ENFIA property tax has taken centre stage this month, following Alexis Tsipras’ announcement that the levy will remain in force in 2017.

Originally introduced in 2011 by the government, the controversial tax was intended to help refill the country’s empty coffers and boost the economic recovery. Since then, Greece’s economy has been through several major changes, as the country has fought to secure continuing bailouts from the European Commission and IMF. Amid the debates, Prime Minister Alexis Tsipras rising to power on the back of an anti-austerity ticket that included a pledge in 2015 to scrap the unpopular tax altogether.

Now, though, he has revealed that the country’s first regular property tax, once forecast to generate around 2 billion euros a year for the economy, is going nowhere just yet.

Speaking at the 81st Thessaloniki International Fair, the Greek Prime Minister confirmed that ENFIA will be in force for 2017, although he added that the government would lower tax burdens for citizens from 2018 onwards.

“I understand that the lower social groups have exhausted their tax giving ability.” he said, citing the country’s economic growth as the driving force behind their ability to lower taxes in 2018.

Tsipras said that the introduction of plastic money, the creation of an exclusive account for paying suppliers, payrolls and social security and tax payments would, as well as reigniting stalled construction and infrastructure projects, would help the economy to recover.

At the same time, Kyriakos Mitsotakis, the leader of opposition party New Democracy, has promised to cut ENFIA, if his party were to be elected.

In an interview with Skai TV, he said that the ENFIA fee would be reduced by 30 per cent over the next two years.

“It is something that is feasible and has been calculated,” he commented, also promising not to lay off public servants and calling for early elections.

“It is no surprise Mitsotakis chose this out of so many taxes to demonstrate his intention to scale back the magnitude of levies taxpayers must pay,” observes Greek news publication Ekathimerini. “ENFIA has become synonymous with the extra tax burden Greeks have to bear on their journey out of the country’s long economic crisis.”