Greece’s newly-elected New Democracy government was voted into office July 7.

The Greece’s center-right New Democracy party won national elections July 7 with 39.85% of the vote and securing 158 seats in the 300-seat Greek parliament. Prime Minister Kyriakos Mitsotakis has set out a new economic program that aims to boost growth through tax cuts and other reforms.

The Newly won Greek government is opening a new chapter in the history of greece, pledging reforms in tax policies,  in an effort to boost economic growth of Greece.

Tax Cuts

The Greek government pledged to cut taxes and new reforms in an effort to boost economic growth in Greece. The property tax cuts is expected to benefit significant number of foreign property investors.

• Reduce the business tax rate to 20% from 28% over two years.
• Cut the tax rate on dividends to 5% from 10% currently.
• Increase the period for carrying forward tax losses, and allow for hyper depreciation of up to 200% on new investments.
• Simplify and accelerate licensing procedures; accelerate judicial review of investment projects in cases of dispute.
• Reduce property tax rates by 30% over two years.
• Tax deductions of 40-50% for renovation and investment in property over the next three years.
• A three-year tax holiday on real estate capital gains and on VAT for construction-related activity.
• Reduce income taxes on low-income earners to 9% from 22% currently.
• Abolish special, crisis-era income taxes on high-income earners.
• Cut social security contributions to a 15% rate from 20% over the next four years.
• Reduce middle and top VAT rates to 22% and 11%, from 24% and 13% currently.
• Reduce tax rate on agricultural cooperatives to 10%, new incentives for cooperatives.

What makes Greece so attractive for investment?

1. Startups

Greece has become home to a fast-growing start-up scene that has attracted more than €350 million in investment, including from several major multinationals like Samsung or Daimler. It is estimated that there are more than 1,000 start-ups in Greece and that by 2020, according to some estimates, the country’s hi-tech industry could make up roughly 10% of the economy.

2. Economy

Greece’s economy grew at an annualized 1.3% rate in the first quarter of 2019, and 0.2% compared with the previous quarter, according to the latest data released by Elstat, the Greek statistics agency. A significant recovery in investments, combined with strong export growth, is helping drive growth. According to the latest OECD report, Greece’s economy is expected to expand 2.1% this year and 2.0% in 2020.

Greek businesses created 159,775 net new jobs in the first four months of the year, according to Labor Ministry data

3. American Interest

American investors are showing new interest in Greece, from financial assets to hi-tech start-ups, reflecting the country’s improved investment prospects and amid warming bilateral relations between Greece and the U.S.

4. Golden visas

Greece has issued over 4500 residence permits to property investors who bought a real estate for atleast €250,000 in Greece. The Golden visa scheme is one of the most popular and successful scheme in the world, that helped greece to recover from debt and pushed towards positive GDP growth after years of recession. The property prices still remains low in Greece, compared to other countries in Europe, attracting foreign investors.

Chinese, Russians and Turks are top property buyers under golden visa scheme.

The expansion of Golden visa to bonds and shares is expected to be announced soon by the new government

5.Greek Bonds

Greece successfully issued a €2.5 billion, 7-year bond, its first since the country exited its financial oversight programs last August. Strong investor demand helped drive the yield to a lower-than-expected 1.90%.

6. Greek Tourism

Greece’s tourism industry contributed €21.6 billion to the economy in 2018 — accounting for 11.7% of GDP — and attracting €5 billion worth of investments.

Tourism receipts are up 14.4% on year for the five months to May, according to the latest data by the Bank of Greece, pointing to another strong year for the sector. However, visitor arrivals were down 0.9% from a year ago, the data showed.

7. Jobless Rate

Greece’s unemployment rates fell 60 basis points to 17.6% in April, according to the coun- try’s statistics service. The latest data marks an eight-year low and a decline of more than 10 percentage points from a peak of almost 28% during the height of the financial crisis.

8. Film productions

New incentives for foreign film productions shooting in Greece are bearing fruit, with representatives from leading international studios like Netflix, Disney, Universal and Amazon recently scouting the country for potential locations and starting new film projects. The country’s new incentive scheme, combined with government efforts to establish new film offices, has changed that. Under a 2017 law – and amended late last year – the government is offering a 35% cash rebate on audiovisual projects filmed and produced in the country. Τhe cash incentives apply to films, documentaries, TV series and digital games. To date, roughly three dozen productions from around the world have taken advantage of the new program.