A draft of the supplementary memorandum agreement between Greece and its creditors has revealed nearly $1.09 billion in additional social security contributions and cuts to government spending for 2018.
The draft agreement features 140 “prior actions,” 11 of which account for the steep cuts proposed for 2018. These measures suggest a lack of confidence on the part of Greece’s creditors, who do not seem to believe that the leftist Tsipras government can deliver its 3.5 percent budget surplus target, according to a report from Naftemporiki.
The prior actions include increasing the social security contributions of self-employed professionals and tradesman and professional farmers. The state would cut spending by EUR 10 million by reductions in social benefits and stipends, and would cut EUR 238 million from the benefits allocated to low-income pensioners. The measures also include cutting the state’s spending on heating oil subsidies by 50 percent.
These cuts would be accompanied by increased taxes, including those created by abolishing tax breaks and deductibles currently in place. The plan would also see a new tax on property transaction, shipping companies and short-term leasing, as well as the activation of an existing tax on overnight stays in hotels and rooms to let.