Greece will present a set of proposed reforms to its creditors on Monday in order to secure a bailout extension. The reforms reportedly contain an $8 billion tax plan targeting the country’s smuggling industry and oligarchs, according to a report in a German newspaper, cited by Agence France-Presse (AFP).
The German tabloid Bild reported that the Syriza government hopes to gain 2.5 billion euros from the plan, with a similar amount gained from back taxes owed by businesses, AFP reported. An additional 2.3 billion would come from a crackdown on smuggled petrol and cigarettes.
However, any reforms proposed by the debt-ridden nation would need to be approved by international creditors in order to secure the four month loan extension Greece is seeking, BBC reported.
Greece currently owes a total of 323 billion euros, principally to the eurozone, but also to banks in Greece and elsewhere, the IMF, and the European Central Bank. Under the current agreement, the total amount of relief pledged to Greece is about 240 billion euros.
Greece is trying to reach an accord that its creditors, principally Germany, would accept, after two previous rounds of negotiations broke down. The far-left Syriza government, led by Prime Minister Alexis Tsipras, campaigned on promises to end austerity measures.
However, Germany has said it would not reduce any of Greece’s remaining debt, and insists that Greece honor the terms of the existing bailout agreement. “As long as the program isn’t successfully completed, there will be no payout,” Wolfgang Schäuble, the German finance minister, told The New York Times on Friday.
Greece had asked for a four month extension on its loan on Thursday, but that request was initially turned down by Germany. On Friday, Greece’s creditors said they were willing to consider the extension, giving them three days to draw up a list of policies for the eurozone’s finance ministers to approve.
“Europe has some breathing space, nothing more, and certainly not a resolution. Now it’s up to Athens,” German foreign minister Frank-Walter Steinmeier reportedly told Bild. “The fundamentals -- namely assistance in exchange for reform -- must remain the same.”
The deal reached on Friday would also allow Greece to ask creditors to drop austerity measures which were never enforced, such as pension cuts and easing mass dismissals and, in return, implement a set of reforms aimed at the country’s wealthy citizens who have fared relatively well in the crisis.
Critical areas of Greece’s private sector are reportedly controlled by a small group of families, who maintain virtual monopolies over industries such as banking, shipping, and construction. The Syriza government has repeatedly denounced their monopoly, with Finance Minister Yanis Varoufakis promising to “destroy the oligarchy,” Reuters reported.
However, the Syriza party has faced criticism from factions within its own ranks. Communist Tendency, a far-left faction within Syriza, denounced Friday’s deal as “submission to the blackmail of the troika,” the Times reported.