Greek Parliament Adopts Painful Reforms – Solidarity and Income Tax Go Up, Pension Benefits Abolished

Despite massive opposition from the people, Greek MPs adopted last night controversial government pension and tax system reforms, a request by the EU and the IMF ahead of the Eurozone creditors meeting in Brussels.

The legislation was adopted by a 'slim' parliamentary majority of the coalition led by the Syriza while Athens hopes that the latest reforms will convince the creditors to unlock further bailout money.

The bill was approved by the 153 MPs of the ruling Syriza/Independent Greeks government coalition while all opposition parties in the 300-member Parliament voted against, reports AP.

Prior to the vote Greek Prime Minister Alexis Tsipras told the parliament that he would get Greece back on its feet at any cost.

As expected, the leading opposition New Democracy was against the austerity measures, reports the AFP agency. At the same time, the streets of Athens saw protests and clashes between the demonstrators and the police.

Greece’s largest private sector labor union, the General Confederation of Greek Workers (GSEE), said that the changes were “the last nail on the coffin” for workers and pensioners who have sacrificed enough after six years of austerity measures.

- They are trying to prove to the Eurogroup that they are good students but they are destroying Greece’s social security system – said a union representative alluding to today’s meeting of Eurozone finance ministers.

Following the collapse of negotiations between the Greek government and international creditors over the pace of reforms in Greece, the payment of the tranche of approximately EUR 5bn is delayed.

The proposed reforms would raise tax on corporate dividends to 15 from 10 percent, increase income tax for high earners and sharply increase a so-called `solidarity tax` -- which goes straight into state coffers.

The new law also envisages the introduction of a national pension of EUR 384 a month after 20 years of work, phases out a benefit for poor pensioners (EKAS) and recalculates pensions.

Greece needs the bailout funds to pay International Monetary Fund loans and European Central Bank bonds maturing in July, reports Reuters.

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