Greece is one of the countries of the Organisation for Economic Cooperation and Development that have moved on to the wider reductions in income tax, but with excise duties, such as VAT, to continue to be one of the largest sources of tax revenue, as a new OECD report notes.
The report «Tax Policy Reforms 2026» it records and compares the tax changes introduced or announced within 2025 in 92 countries. In the case of Greece, the OECD distinguishes the reform of income taxation, with a particular focus on families, young workers and self-employed people.
It is noted that for comparing the composition of tax revenue, the latest details used by the OECD for Greece concern 2023.
Lower tax on medium income
The OECD makes particular reference to changes in the Greek tax scale. Income rates from 10,000 to 40,000 euros were reduced by 2 percentage points.
At the same time, a rate of 39% was introduced for the income segment from 40,000 to 60,000 euros. The maximum rate of 44% was maintained, but is now applied only to income over 60,000 euros. Changes lead to a lower tax burden mainly for medium and higher incomes.
At the heart of families and young people
Greece is included, together with Hungary and Malta, in the three countries which have made wide changes in the taxation of families, with a view to tackling the demographic problem.
The rates for income up to 30,000 euros vary according to the number of dependent children. For taxpayers with four or more children there is a zero income tax up to 20,000 euros.
Special reference is also made to the reliefs for young workers:
- For young people up to 25 years of age a zero rate is provided for the first two income steps, while for the ages from 26 to 30, a 9% rate is applied.
The OECD also records the three-year exception to new mothers self-employed from the minimum assumed income. Interventions include the reduction of imputed income for professionals in areas with less than 1,500 inhabitants.
Interventions in real estate
In rent taxation, the report notes the creation of an intermediate rate of 25% for income from 12,000 to 24,000 euros. At the same time, the threshold above which the maximum rate of 45% is applied increased to 36,000 euros.
The three-year tax exemption for owners carrying properties from short term to long-term lease or opening vacant dwellings is still recorded. The reliefs add the gradual abolition of the ENFIA for main dwellings in small or demographicly weakened settlements.
The high VAT dependence
Despite reductions in direct taxes, Greece continues to rely heavily on consumer taxation. According to the OECD, taxes on goods and services are the country's largest individual source of tax revenue, while their participation in the overall tax mix has increased compared to 2000.
This means that a significant part of the State's revenue is still derived from VAT and other indirect taxes charged on daily purchases. These taxes affect lower incomes more proportionately, as these households have more than their consumption earnings.
However, the report records targeted exceptions, such as the extension of VAT suspension to certain new structures until the end of 2026 and the reduction of rates by 30% on specific islands.
