The Golden Dawn story may have dominated the news lately, but life in Greece doesn’t pause – and that usually means more and more financial burdens on the backs of people who have already been struggling for years. Well, this time it’s homes, and the latest bill the Ministry of Finance has drafted that in effect advises home-owners to give up their properties in order to pay off their taxes.
One might say, this sounds pretty and quite like it is done elsewhere. Taxes are taxes and should be paid by everyone. And if you couldn’t afford it, you shouldn’t have bought it, and if you can’t afford it now, you should probably let go of it. Right?
Well, dear reader, in Greece there is a catch: the real estate business is really not working. There is close to zero chance of one being able to sell their house when in need – or even when not in need – and, especially, anywhere close to the price the house might actually get in a healthy market (mind you, by a healthy market, I mean in an economy working well: not overpricing properties and not downgrading them either).
In order to overcome this hurdle, the Ministry of Finance came up with this solution: sign the property over to the state. Your property will be assessed, based on a special methodology, and then, provided it is worth more than you owe, signed over to the state. And you will be done with that debt.
End of story.
Do you sense that something is missing?
*uh – huh*
As revealed by the newspaper To Vima, according to the bill, expected to be presented to the parliament “soon”, those who can’t pay off their debt in cash, will have the following options:
– Sign the property over to a third party, while at the same time assigning to said party the obligation to pay off the tax.
– Sign over to the Greek State the full ownership of an estate of at least equal value to the tax owed.
Did you catch what’s missing?
Let me help you: in case the estate is worth more than the tax owed, the tax payer does NOT get compensated for the difference.
That’s right. They can now take your house for any amount of money owed, and you will not be getting «your change» back.
Not only that, but the very same law predicts that, in case you do find someone to sell your house to, but have not paid the 2014 property tax (i.e. if you need to pay your property tax, don’t have the money to do so and have to sell your house), well, now you can’t. Lawyers and notaries are prohibited from drafting a contract if that tax is owed – otherwise they will be fined up to 5,000 euros, or have the obligation to pay the tax themselves within three days of drafting the contracts.
Lest we forget, property taxes have skyrocketed in the past 3 years, with home owners to have to pay at least four different taxes a year on the same property. That mounts up to an insane amount of money, on people who, at best, have seen their incomes drop by at least 50%, or have lost their jobs completely. And in a country where reforms are being implemented in the slowest rate possible while taxes are being passed by acts of legislative content.