Greeks march again against cuts, new tax

Reuters/Athens

Tax office employees shout slogans outside the finance ministry during a protest against the Greek government’s austerity measures in Athens yesterday

The Greek parliament yesterday approved a deeply unpopular property tax to lure international lending inspectors back to Athens and release vital aid, even as demonstrators stepped up protests against more austerity.The vote was an important first test of the nation’s ability to push through a new wave of belt-tightening to persuade the IMF and EU that it deserves an 8bn-euro ($11bn) loan it needs to pay salaries and avoid bankruptcy next month.All 154 of the ruling Socialist PASOK party’s deputies voted in favour of the measure, winning a majority in the 300-seat parliament. The government’s majority had fallen to 154 out of parliament’s 300 seats after one deputy was expelled from the party for voting against a previous austerity package in June when public protests raged on the steps of the assembly.“The decisions of July 21 are like an institutional Bible to us,” Finance Minister Evangelos Venizelos said, underling his commitment to meet the targets of a new bailout deal agreed this summer. “They are the framework within which we move.” But ordinary Greeks are exasperated at more austerity misery. Bus drivers and metro workers launched a strike yesterday to protest against the measures with tax collectors and some Finance Ministry officials starting a 48-hour stoppage.A column of garbage trucks and city workers on motorcycles drove slowly in front of parliament honking horns in the ancient capital’s Syntagma Square, where about 100 people were hurt in bloody clashes between protesters and police in June.At the other end of the square, riot police held back hundreds of activists waving banners saying ‘No New Cuts!’ and chanting ‘Take Your Bailout and Go Away!’ who surrounded the finance ministry while Venizelos held a news conference inside.Having grown increasingly impatient at the slow pace of reforms, a “troika” team from the IMF, EU and European Central Bank abruptly quit Greece this month threatening to cut off funds, prompting Athens to unveil an intensified strategy.After Venizelos spoke with officials at a weekend IMF meeting in Washington, Eurogroup chairman Jean-Claude Juncker said he had been informed the team would return to Athens by tomorrow, when sources close to the troika said they would start calculating whether Greece had done enough for the aid.Venizelos said Prime Minister George Papandreou would send a letter of written assurances demanded by the inspectors to show the government is totally committed to meeting its obligations.“The disbursement will take place and will take place on time,” Venizelos told a news conference partially drowned out by whistling and shouting activists outside protesting ahead of the vote on the property tax.“I’m a pensioner, I get 500 euros a month ... This is absurd,” said Costas Papaioannoun, a 65-year-old retired teacher. “I don’t have the money to pay (the tax). Let them come to my house, put me in jail. We have already gone bankrupt anyway.”The troika team has criticised the Athens government for dragging its feet on a promise to cut the 730,000 public workforce by a fifth and sell off loss-making state firms.The government has also failed to end widespread tax evasion, while a third year of economic contraction has eroded budget revenues and undermined Greece’s goal of cutting the budget deficit to 7.6% of annual output this year.Responding to media reports that many state run organisations had missed a September 26 deadline to name employees they can lose, Finance Ministry secretary general Ilias Plaskovitis said there could be outright sackings - anathema in Greece, where public jobs are protected by the constitution.European leaders facing rising pressure from their domestic voters about footing a colossal bill for debt-laden states have objected to the idea of keeping Greece afloat if it does not fulfil its part of the bailout.“If someone asks me - what if the conditions are not met? I say - then there cannot be any money,” Austrian Chancellor Werner Faymann told a news conference, adding that the troika was particularly irked by Athens’ slow approach to selling off public companies.In its new austerity package to convince the troika, the government said it would cut public salaries and pensions, put 30,000 public contractors on notice and extend the property levy until 2014, two more years than planned.Business has also bridled at the EU/IMF prescribed austerity measures. Constantinos Mihalos, head of the Athens Chamber of Commerce, said tax hikes and falling consumer demand was undermining the country’s appeal for foreign investment.  “How can foreigners invest in our country, when taxation is more than 45% and there is not a single action to support the real economy?” he said.Papandreou, whose socialist PASOK party has suffered a sharp drop in support since June and is well behind the conservative opposition in polls, was in Germany  and meeting Chancellor Angela Merkel ahead of another key parliamentary vote there tomorrow that is meant to give more powers to the EU’s EFSF bailout fund.