Reforming the tax system is imperative to avoid upsetting fiscal balance in the post-pandemic period, Bank of Greece’s governor Yannis Stournaras said on Wednesday, addressing the Academy of Taxation and Accounting of the European Organization of Civil Law.
In his speech, the central banker underlined that changing the fiscal policy mix towards easing the tax burden for workers and enterprises and moving towards a more fair distribution of this burden was an un-denying need and must be continued.
Lowering taxation offers a multiplying positive effect on the economy, both on the demand and offer side. “In 2019, a significant effort of tax reform began with the introduction of reforms of permanent nature focusing on a gradual easing of tax burden,” Stournaras said, adding that “a further reduction of tax rates and social insurance contributions will support employment, competitiveness and economic growth and will operate as an incentive to reduce tax evasion and informal labor.
In the long-term, consequently, it will have a positive impact on public finances,” he said. Referring to the need of expanding the tax base, Stournaras said that the increased use of plastic money helps towards this direction.