“Cuts” of up to 35% in living standard indicators for residences, up to 73% for cars and up to 30% for recreational boats are provided by the new tax bill that was put to public consultation yesterday, Wednesday. At the same time, taxpayers’ dependent children who have their own income are fully exempted from the minimum indicator of €3,000. The changes in Imputed Income will apply to 2025 income, which will be declared in 2026, giving “breathing room” to approximately 480,000 taxpayers who are caught in their “trap” each year and are taxed on higher incomes, paying additional taxes.
What changes with Imputed Income
1. Residences. The living standard indicator for primary residence is calculated progressively based on its surface area and is reduced as follows:
– Up to 80 sq.m. main areas, €28 per sq.m. (from €40/sq.m.)
– From 81 sq.m. up to 120 sq.m. main areas, €45 per sq.m. (from €65/sq.m.)
– From 121 sq.m. up to 200 sq.m. main areas, €77 per sq.m. (from €110/sq.m.)
– From 201 sq.m. up to 300 sq.m. main areas, €140 per sq.m. (from €200/sq.m.)
– From 301 sq.m. and above main areas, €280 per sq.m. (from €400/sq.m.)
The above amounts are increased by 30% (from 40% today) for residences located in areas with zone prices from €2,800 to €4,999 per sq.m. and by 58% (from 70%) for areas with zone prices from €5,000 and above per square meter.
For example, a primary residence of 80 sq.m. in an area with a zone price of €1,750 per square meter sees its living standard indicator reduced from €3,200 to €2,240 (30% reduction)
For detached houses the indicator is increased by 20%. For secondary residences the indicator amounts are reduced by 50%.
2. Cars. Changes in the calculation method of living standard indicators concern owners of passenger cars up to 15 years old, i.e., those registered from November 1, 2010. The new calculation method for passenger cars follows the circulation fee calculation system:
– For all passenger cars up to 15 years old, i.e., those registered after November 1, 2010, objective expenses will be determined based on CO2 emissions (proportionally to circulation fees), with significant reduction of objective expenses, resembling the level of objective expenses that cars over ten years old have today. This new calculation method will result in reductions in indicator amounts that will be greater and exceed even 50% for new technology passenger cars up to 5 years old and smaller for cars that are 10 years old.
– For passenger cars “aged” more than 15 years, i.e., those that first circulated in the E.U. up to 2010, living standard indicator amounts will remain unchanged.
Examples of car indicators by brand
– Toyota Corolla 1.8 140 Hybrid (1,798 cc, 99 g/km CO2): The indicator collapses from €7,600 to €2,000, with a 73.7% reduction. Even if it’s a ten-year-old vehicle that previously had a “half” indicator (€3,800), the reduction to €2,000 means a 47.4% “haircut” in final taxable income.
– Honda Jazz 1.5 Hybrid (1,498 cc, 102 g/km CO2): The indicator for a new vehicle was €5,800, while after a decade it dropped to €2,900. From now on, the deemed income is calculated at €2,000, i.e., a 65.5% reduction compared to the new vehicle or 31% compared to a ten-year-old one.
– Fiat 500 1.0 70 (999 cc): The indicator decreases from €4,000 to €2,000, i.e., 50%, corresponding to the amount it would have after completing a decade.
Impressive reductions are also observed in the premium category:
– BMW 116i (1,499 cc, 129 g/km CO2): The indicator decreases from €5,800 to €2,210, i.e., by 61.9%.
– Mercedes A200 (1,332 cc, 133 g/km CO2): Decreases from €5,200 to €2,330, i.e., 55.2%.
Even for larger or more powerful models the reductions are significant:
– Audi A4 35 TFSI (1,984 cc): The indicator drops from €8,800 to €2,450, theoretically a 72.2% reduction, while practically the final reduction is 44.3%.
– Audi Q3 35 TDI (1,968 cc, diesel): Decreases from €8,800 to €2,645, i.e., by 69.9%.
3. Recreational boats. For boats today, the deemed expense from each boat is reduced according to its age by 15%, if more than 5 years and up to 10 years have passed since the year it was first registered, and 30% if more than 10 years have passed. With the changes, the deemed expense is now reduced by 30% for newer boats as well, since maintenance expenses are not higher for newer ones, but also with the aim of strengthening purchasing power.
Example: For a 5-meter speedboat the indicator is reduced from €4,000 today to €2,800 (30% reduction).
The annual deemed expense amounts are reduced by 50% for sailing boats. They are reduced by the same percentage for pleasure craft that have been or are being built in Greece entirely from wood, of types “trechantiri”, “varkalas”, “perama”, “tserniki” and “liberty”, which come from Greek naval tradition.
