Greek government submits new austerity bill to Parliament

Successful review of the country's reform plan by its creditors would release a substantial slice of rescue loans

Greece's left-led government has submitted to Parliament a new package of creditor-demanded tax hikes and reforms worth $2 billion, which it hopes to have approved by lawmakers in time for a meeting of European officials next week.

The country's reform program is under close scrutiny by its creditors – other European countries and the International Monetary Fund (IMF) – and a successful review would release a substantial slice of rescue loans allowing Greece to pay off bonds due this summer.

No details were immediately available on the measures, which are expected to include across-the-board tax hikes, including raising the rate of consumer tax by one percentage point to 24% and increasing taxes on fuel, coffee, alcohol, tobacco and hotel stays.

However, the government has said it won't initially include a contingency plan that would automatically trigger extra budget savings if Greece misses savings targets in coming years.

Officials say that will be submitted as an amendment later "for technical processing reasons", but insist that they don't expect the measures will have to be implemented.

The draft legislation is the latest in a series of income cuts, tax hikes and reforms imposed on austerity-weary Greeks since 2010, when the debt crisis exploded that brought Greece to the brink of bankruptcy and expulsion from the eurozone.

The country has been keeping afloat with the help of multi-billion euro rescue loans from its European partners and the IMF, released on condition of tough spending cuts and deep structural reforms.

Parliament officials late yesterday said that the draft legislation is expected to be debated at a Parliamentary committee today, with a view to it being voted on in the plenary session on Sunday. The government has a three-seat majority in the 300-seat house, and is expected to secure approval for the bill.