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Tax on contributions halted

22/01/2016 11:28
The tax department decided the freezing of the process of sending letters relating to the taxing by 30% of the contributions to various social funds amid reactions from employers and trade unions.

As Clelia Papadopoulou, a top tax officer stated to StockWatch when invited to comment on a publication of the Fileleftheros newspaper, the tax department has decided not to proceed with the imposition of taxes for social benefits to other bodies until the nature of the benefits is examined and it is decided whether they are taxable or not something which, as noted, will be applied in both the public and private sectors.

For organizations to which such tax letters have been sent already, there is the possibility of submitting an appeal by the end of January 2016, which will be examined by the tax authorities.

The decision of the department was taken amid the intense reactions caused after sending tax returns to impose 30% tax on semi-governmental organizations on contributions to various social funds retroactively from 2009. The unions argue that such a decision would have a negative impact on the benefits of workers.

The SEK general secretary Nikos Moiseos in a meeting with the Minister for Finance Haris Georgiades, called the proposal unprecedented and unacceptable, noting that employers may shift the burden of taxation on workers.

The general secretary OHO SEK Andreas Elias noted that the practice of taxing different contributions to social funds starts with some semi-governmental organizations, and if left will be extended to the private sector and will result in cutting benefits for workers.