A shock is awaiting 2,400,000 Greek taxpayers with annual real income between zero and 5,000 euro. This year, they will have to pay tax even if they have no income at all. The tax law applied this year for the income of 2012, will be based on so-called “deem income criteria.” According to this Troika-imposed austerity measure, regardless of the actual income, every taxpayer is “charged” with a presumptive income of minimum 3,000 euro – for married couples 5,000- per year to cover living needs. In addition, another “presumptive income” is calculated by the tax authorities, if the taxpayer owns the home he lives in. Greek finance ministry will tax it presuming the owner needs several hundred euro per year for maintenance.
Daily Eleftheros Typos published on Saturday several examples of the injustice of this measure:
A pensioner had an annual income 4,800 euro in 2012. He lives alone in his home of 80 square meter in an area with objective value below 2,800 euro per sq.m.
Based on the income tax bracket the income of 4,800 euro is tax-free as the lower taxable cap is 5,000 euro.
when he will fill his income declaration this year though, he will have to add:
-3,000 euro for minimum living presumption and
-3,200 euro (40 euro/sq. m.) as residence maintenance presumption.
Based on these two ‘deemed income’ criteria, the tax office will calculate, the man has to have an income of 6,200 euro.
The pensioner will be charged with income tax of 10% for the amount of 1,200 euro (6,200 deemed income -5,000 tax-free threshold = 1,200 euro.). The pensioner will have to pay 120 euro even if the tax law officially grants him 5,000 euro are tax-free.
If this man has the luxury of owning a car, additional ‘deemed income’ will be added for vehicle maintenance cost. (more…)