Greek PM unveils tax, pension relief measures ahead of elections

Greece’s lefist Prime Minister Alexis Tsipras on Tuesday unveiled additional tax and pension “relief measures,” weeks before a European Parliament election.

During a press conference at Zappeion Hall in Athens, Tsipras pledged to reinstate a benefit for pensioners who had their income slashed in 2012 and to lower value added tax in some categories. The measures include reducing the VAT on a range of food products from 24 to 13 percent, and cutting the rate on energy and food services to 6 percent from 13 percent.

Handouts to pensioners are expected to total 800 million euros.

Tsipras also announced a package for 2020, including “growth-oriented” measures worth 1.3 billion euros, including the abolition of a solidarity levy on incomes below 20,000 euros.

The 2020 package also includes measures aimed at drawing investments and encouraging employers to hire young Greeks.

In the coming days, Tsipras told reporters, an amount of 5.5 billion euros would be deposited in an escrow account, which would serve as a guarantee that Greece would meet its fiscal targets and debt obligations.

Greece’s budget performance in 2018 was better than expected, with a primary budget surplus, excluding debt servicing costs, of 4.4 percent, while creditors demanded a 3.5 percent surplus.

Late on Monday, the government submitted to Parliament a bill giving relief to millions of people owing tax and pension contribution arrears.

Tsipras' term ends in October and he has ruled out early polls. His Syriza party is trailing the conservative opposition ahead of European Parliament elections, which will coincide with local elections on May 26.