Greek Lawmakers OK New Taxes, Foreclosures

Vyron Polydoras said he couldn't stomach voting for any more taxes on Greeks

ATHENS – The Greek Parliament on Dec. 21 narrowly approved a unified property tax bill in the face of angry protests by farmers, and for a partial lifting of a ban on mortgage foreclosures, but it cost the coalition led by Prime Minister Antonis Samaras another member when he ejected MP Vyron Polydoras from the New Democracy Conservatives for voting against it.

Only 152 lawmakers in the 300-member body voted for the tax after Samaras and PASOK Socialist leader Evangelos Venizelos, his partner, reeled in other would-be rebels, although another test was due later in the day over whether to partially lift a ban on foreclosures. PASOK’s Apostolos Kaklamanis was absent and did not vote.

The government got the okay for ending the outright moratorium on foreclosures when it expires on Dec. 31 by the same slim margin. But dumping Polydoras left the coalition with only a three-vote majority, further weakening the government. The new tax, which unites previous levies and seeks to raise more than 2.5 billion euros ($3.41 billion next year.

Before the vote, Polydoras slammed the new, unified property tax, saying he could not accept the levy. “What sort of policy is this when you step on homeowner’s throats?” he said. “Do you expect me to vote for this?” When he didn’t, he was applauded by opposition parties. He had previously gone along with harsh austerity measures.

Samaras’ office fired back at his one-time deputy. “At a time when the government is successfully trying to get Greece out of the economic crisis, Mr Polydoras has consciously chosen to oppose these efforts and his party and to identify with the anti-Europeans, the populists, the supporters of the drachma and those who deny the national effort to save the country,” the conservative party said in a statement

If enough of the ruling party MPs had broken away to reject the legislation it could have threatened the government itself although reports were that Samaras and PASOK leader Evangelos Venizelos, who brought his vanishing party into the coalition, had spoken to would-be rebels in hopes of quelling dissent.

Venizelos, who is Deputy Premier/Foreign Minister in Samaras’ government has voiced some dissatisfaction but went along as his party, hovering at only 5 percent in the polls, would otherwise be irrelevant.

Samaras had just returned from a trip to meet European Union leaders in Brussels where he talked about Greece’s agenda for the symbolic, rotating six-month presidency of the bloc it will hold starting Jan. 1, Prime Minister Antonis Samaras returned hoping that Parliament on Dec. 21 will pass a new property tax bill and a partial lifting of a foreclosure ban.

The two reforms are demands of the country’s international lenders, the Troika of the European Union-International Monetary Fund-European Central Bank (EU-IMF-ECB) that is pressing Samaras, the New Democracy Conservative leader, and his partner, the PASOK Socialists, to speed the pace of delayed reforms.

The unified property tax bill drew angry protests from farmers, who will be included for the first time, and led to clashes with riot police outside Parliament. It also incorporates a 100 percent surcharge on property taxes that was added to electric bills in 2011 for what was supposed to be a one-year stopgap but is not set to be permanent.

Government ministers were also scrambling to make the legislation on home foreclosures more palatable for coalition deputies. Development Minister Costis Hatzidakis met with PASOK MPs for a second time to discuss possible last-minute changes and it did the trick as some lawmakers who voiced objections got in line and passed the bill.

Finance Minister Yannis Stournaras was called into a hearing of Parliament’s finance committee to remove a number of provisions that were attached to the foreclosures bill but which related to a number of other issues, such as the country’s privatization fund.

The foreclosure bill was the most contentious because it will allow banks to confiscate the homes of people who can’t afford to pay their mortgages because of big pay cuts, tax hikes and slashed pensions administered by the government on Troika orders.

There would be protection extended – for one year – for those with primary residences valued at up to 200,000 euros ($275,000) and with incomes of under 35,000 euros, ($47,855.)

The major opposition party Coalition of the Radical Left (SYRIZA) said the plan is just a temporary appeasement before the government allows banks to take people’s homes with more than 230,000 said to be in default.

Protesters have also been demonstrating in vain over continued assaults on their income and as the government moves to up the number of public workers who will be fired.