Working from home has become a necessity for many due to restrictions that governments have imposed in an attempt to control the spread of coronavirus, Greece has been trying to entice remote workers to move there.
Besides forcing many people to work from home, restrictions have brought tourism to a near halt so the government’s latest plan offers an enticing workaround given Greece’s status as a popular tourist destination. According to the plan, workers who move to Greece in 2021 will receive an income tax cut of 50%.
The Greek government is aiming to make the best of the crisis with its new plan designed to link the country’s allure as a tourist mecca and aspirations to strengthen the national economy’s digital sector.
Development of technology has allowed people to choose where they live and work, noted Alex Patelis, chief economic adviser to Greece’s Prime Minister Kyriakos Mitsotakis, in announcing the plan. It was hard to beat incentives that combined good weather with tax cuts, he suggested.
With the current income tax rate of 44% on annual income over 40,000 euro, the announced plan would drop the rate to 22% for seven years. Accordingly, the offer will be available to anyone who moves to Greece next year and has not been paying taxes in Greece in the last seven years.
The government’s plan seeks to mitigate the negative effects of the brain drain that resulted from an economic contraction of about 25% over the last decade, during which about 800,000 Greeks emigrated. The proposed plan is to be put to a vote in the parliament by the end of the year.
Greece’s Alternate Minister for Fiscal Policy Theodoros Skylakakis pointed out that the Mediterranean climate, low real estate prices compared to most EU member states and relatively successful coronavirus crisis management have opened doors to the plan.
When the pandemic broke out, Greece imposed a lockdown quicker than most of its neighbours and launched a media campaign to curb infection rates. During the spring lockdown, many public services moved apparently seamlessly online, with digitalisation retaining momentum.