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FACTDROP: Greece in revolt over property tax


Greece in revolt over property tax

Greeks protest with the 'I won't pay' movement over the property tax outside the council of state in Athens.

Πηγή: The Guardian
By Helena Smith
Nov 2 2011

Few measures have elicited more anger – or ingenious forms of revolt – than the property tax announced by Greek ministers to plug a budget black hole that might have gone unnoticed had Greece's plight not threatened the entire eurozone.

In the three months since the government conceived of boosting revenues by including the household duty in electricity bills, local mayors, leftist politicians, unions, lawyers, property owners and the public power corporation have all vowed to do whatever they can to stop the law.

Already suffering wage cuts, benefit losses and tax increases, many have said that even if they wanted to, they simply couldn't cough up.

Officials say those who refuse will have their electricity cut off.

Even by the standards of Greece, where an estimated 30% of the economy goes unrecorded, the backlash to the levy has taken officials by surprise. With the public power corporation flicking the switch on the health ministry last month – in protest at its failure to pay its bills – and militant unionists pledging to picket electricity boards across the land next week, civil disobedience is on the rise.

In the northern town of Veria, Robin Hood-style activists have gone a step further, reconnecting electricity supplies in homes owned by poor Greeks unable to keep up with bills, and leaving signature orange stickers on power boxes.

On Friday, Greece's highest court, the council of state, stepped into the fray. After being besieged by appeals from the Athens bar association and other bodies, it began considering whether the legislation should be revoked.

The cash-strapped government had hoped the levy would raise €2bn (£1.7bn) by the end of the year – a fraction of the estimated €60bn (£56bn) lost in tax evasion since the 1970s, but enough to cover missed fiscal targets in 2011.

Addressing parliament on Friday, the country's new prime minister, Lucas Papademos, insisted that the tax could not be dropped. Revenues have dropped as a result of the successive waves of belt-tightening demanded by the EU and IMF in return for rescue loans.

"The measure itself cannot be abolished, as it is necessary for our process of fiscal adjustment," said Papademos, whose interim administration is expected to be in power until early next year.

But in a nod to the outcry that the law has caused, the new prime minister conceded that in a country blighted by record levels of unemployment, repayment terms would have to be eased.

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