Lawmakers in Athens have passed a bill that will introduce further tax cuts, price hikes and a new privatisation fund. Greece has to save 5.4 billion euros ($6 billion) to unlock more bailout funds from its creditors.
Greece’s parliament on Sunday passed an omnibus reform bill providing for tax hikes, more austerity reforms and a new privatization superfund, which will manage almost all state property.
Prime Minister Alexis Tsipras saw 153 members of his coalition vote for the bill, with 145 others voting against the measures. The decision came ahead of a Eurogroup meeting on Tuesday, expected to unlock another tranche of money for the debt-ridden country.
Under its current bailout deal with the European Union (EU), Greece has pledged to bring its primary budget surplus, exluding debt payment, to 3.5 percent of gross domestic product (GDP) by 2018.
Under the new 7,000-page bill, the sales tax rate on food products and drinks is to rise to 24 percent from 23 percent. Petrol, diesel, electricity, internet, mobile communications, cigarettes and alcohol will also be more expensive than before. Tourists are to pay extra tax for staying at hotels and pay higher entrance fees at museums.
The controversial new privatization fund, controlled by the country’s creditors, is to be used to sell public companies. Another controversial part of the bill includes a mechanism to automatically slash public expenditure in case of budget overruns.
Political parties opposing Prime Minister Alexis Tsipras’ proposal have said the bill goes against the constitution. The heated debate also included comments on how Tsipras’ leftist Syriza party had promised something completely different when it won the elections in 2014.
The latest bill follows similar reforms to cut back pensions and increase tax, passed on May 8. These were to save Athens 3.6 billion euros. Sunday’s measures are designed to save an additional 1.8 billion euros, guaranteeing Greece further help from its international creditors.
Earlier on Sunday, transport workers in Athens staged a 48-hour-strike to protest the new tax hikes. Metro, tram and commuter train drivers walked out on Saturday and were joined by bus drivers on Sunday.
Outside the parliament building in Athens more than 10,000 people protested against the unpopular reforms.
mg/rc (AFP, dpa)