With the main priority being to maintain the primary surplus at high levels and fully aligned with the new budgetary rules, the project is submitted to Parliament on Monday budget 2025.
Next year, Greece has the potential to exceed the 3% cap on primary expenditure, to 3.7%, due to better performance on surplus targets, thus allowing for a series of interventions to increase income and reduce taxes .
For 2025, a further reduction in debt as a percentage of GDP is planned to 149.1%, from 153.7%, which will occur in 2024, paving the way for further updates of Greek debt.
Based on what is also contained in the Medium-Term Financial Structural Plan 2025-2028 for next year, it is expected:
- inflation at 2.7% this year and falling to 2.1% in 2025
- a higher primary surplus, of 2.4%, in 2024 (compared to a target of 2.1%), despite extraordinary expenses, which are mainly due to economic growth and the fight against tax evasion. “Due to this primary surplus, we succeeded and convinced the EU that we could increase spending even further. Because we were convinced that there are now forces and structures to achieve debt reduction, together with a reasonable increase in spending,” said Minister of National Economy and Finance Kostis Hatzidakis on Friday in the plenary of Parliament. In 2025 the primary surplus will be 2.5%
- deficit of 1% this year and 0.6% in 2025, that is, well below the 3% limit established by the new Stability Pact. “This is a household item and sends a message of confidence, at a time when 7 EU countries (including Italy, France and Belgium) are in an excessive deficit process”, according to Kostis Hatzidakis
- reduction of public debt to 153.7% of GDP in 2025 and a further reduction to 149.1% of GDP in the following year. Meanwhile, another early repayment of the installments of 7.9 billion euros for the years 2026-2028 of the loan received by our country under the first memorandum is scheduled for December.
- continuation of the growth dynamics of the Greek economy, albeit at rates lower than initial forecasts. GDP is estimated to grow by 2.2% in 2024 and 2.3% in 2025.
- Unemployment, from 18% in 2019, is estimated to decrease to 10.3% in 2024 and 9.7% in 2025.
The draft budget will include all the measures already announced, worth 1.45 billion euros, which provide for:
Increase in pensions depending on the evolution of inflation and growth rate. The increase is estimated at around 2.5%.
Emergency financial assistance of 100-200 euros in December for retirees who will not see an increase in their pension due to a personal difference. It concerns around 670 thousand retirees with pensions of up to 1,600 euros, who have a personal difference of more than 10 euros. In addition, within December the following will be paid:
– an additional benefit to OPECA family benefit beneficiaries
– a boost of 200 euros for recipients of e-EFKA disability benefits
– Help of 200 euros for beneficiaries of the OPECA disability allowance. It concerns around 185,000 people
– Subsidy of 200 euros for uninsured elderly people. Uninsured elderly beneficiaries of the corresponding OPECA subsidy (around 35,000) will receive help of 200 euros
– an additional 50% of the monthly subsidy for beneficiaries of the guaranteed minimum income. Recipients of the guaranteed minimum income (around 205 thousand) will receive an additional 50% of the monthly subsidy during the month of December.
- Horizontal increase in State salaries from April 1st so that the starting salary does not fall below the minimum wage. From April 1, 2025, the new minimum wage for the private sector will come into force, which will be 830 euros, with a horizon of increase to 950 euros in 2027.
- Expansion of the subsidy for meeting targets.
- Increase in the student accommodation allowance at regional universities from 1,500 euros to 2,000 euros per year and 2,500 in the case of cohabitation, starting from the current academic year.
- 20% increase in remuneration for night uniforms (Police, Firefighters, Coast Guard, Armed Forces) from 01/01/2025.
- New 1% reduction in insurance contributions from the beginning of 2025. By 0.5% in employee contributions and by 0.5% in employer contributions in the Health sector
- Abolition of the simulation fee for freelancers.
- Permanentization of the tax declaration for agricultural oils with application of zero tax from 2025.
- Income tax exemption for three years for unoccupied rental properties.
- VAT exemption on new buildings.
- Exemption from tax on insurance premiums (15%) on health policies for children up to 18 years of age.
- Voluntary business benefits tax exemption for new parents.
- Reduction of ENFIA by 20% for homes worth up to 500,000 euros that are insured against natural catastrophes.
- Independent taxation of NHS doctors on duty at a rate of 22%.
In the draft budget that will be submitted to Parliament on Monday, it is likely that the same forecasts for the evolution of oil prices as those mentioned in the Medium Term will be incorporated. That is, at 85.4 dollars per barrel for Brent oil this year and at 80 dollars per barrel in 2025.