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Athens - Greece plans to stop collecting an unpopular property tax through electricity bills and impose a unified real estate levy instead, after an outcry over poor households whose electricity was cut off for failing to pay.
The finance ministry said it would submit a bill to parliament proposing a new levy on property to be collected directly by tax authorities from 2014.
The levy was aimed at protecting Greeks with low-value homes.
Inspectors from the European Commission, European Central Bank and the International Monetary Fund, who arrived in Athens earlier this week to resume a review of the country's bailout programme, had approved the bill, said a finance ministry official.
Projected shortfall
The controversial property tax was introduced as a one-off measure in 2011 to help the country raise revenue as it struggled with a deep recession, but the government extended it this year to the dismay of austerity-hit Greeks, who have suffered several rounds of wage and pension cuts.
The property tax and a second, smaller levy on real estate assets brought in about €2.9bn annually.
Athens expects revenues to fall to €2.65bn under the new unified levy, the official said, and to offset the projected shortfall the government will cut its public investment programme by €200m.
Leftists and anti-austerity activists have railed against the property tax since its inception, saying it is unfair and burdens the poor.
The finance ministry said it would submit a bill to parliament proposing a new levy on property to be collected directly by tax authorities from 2014.
The levy was aimed at protecting Greeks with low-value homes.
Inspectors from the European Commission, European Central Bank and the International Monetary Fund, who arrived in Athens earlier this week to resume a review of the country's bailout programme, had approved the bill, said a finance ministry official.
Projected shortfall
The controversial property tax was introduced as a one-off measure in 2011 to help the country raise revenue as it struggled with a deep recession, but the government extended it this year to the dismay of austerity-hit Greeks, who have suffered several rounds of wage and pension cuts.
The property tax and a second, smaller levy on real estate assets brought in about €2.9bn annually.
Athens expects revenues to fall to €2.65bn under the new unified levy, the official said, and to offset the projected shortfall the government will cut its public investment programme by €200m.
Leftists and anti-austerity activists have railed against the property tax since its inception, saying it is unfair and burdens the poor.
