BoG: Taxes and contributions holding back growth

Non-salary costs in Greece are 10 percentage points above the mean rate of members of the Organization for Economic Cooperation and Development (OECD) and the European Union, according to the Bank of Greece's intermediary monetary policy report. It also stressed that the economy has not yet returned to normal as it is has not had access to money markets in a sustainable way.

The central bank's report showed the importance of overtaxation in Greece, presenting a case study which revealed that if income tax and social security contributions were slashed by just one percentage point, the country's gross domestic product would grow by up to 7 billion euros up to 2021.

"The main finding of the analysis is that a permanent easing of the tax burden on labor will have a permanent positive result on economic activity," the report that Governor Yannis Stournaras submitted on...