Gov’t to fully abolish ‘solidarity tax’ in 2023; austerity measure first imposed in 2011

The so-called “solidarity tax” imposed on Greek taxpayers earning more than a certain gross income per year – mostly wage-earners, in this case – will be abolished as of Jan. 1, 2023, the center-right government announced on Tuesday.

The first threshold set back in 2011 for imposing the extra tax was 12,000 euros, in gross income, which was bitterly criticized at the time. Among others, the extra tax was deemed as affecting low-income taxpayers as well.

The tax was first abolished for private-sector wage-earners last year, but retained for pensioners and those employed throughout Greece’s wider public sector, including state-run utilities and agencies.

The “extra” tax, on top of the regular progressive income tax rates, was imposed in 2011, as part of the initial batch of austerity measures emanating from the first memorandum bailout agreement with creditors. Although billed as “temporary” at the time, it was maintained up until today.

Abolishing the unpopular “solidarity tax” was, in fact, a pre-election pledge by the current Mitsotakis government ahead of the snap election in July 2019.

Abolition of the measure will affect around 1.2 million taxpayers in Greece.