Thursday’s Eurogroup resulted in a warning from European Stability Mechanism managing director Klaus Regling that Greece may miss its primary surplus target this year as a result of the so-called positive measures adopted.
The Greek government is in an awkward position regarding the expansionary fiscal measures announced by Prime Minister Alexis Tsipras last week and adopted by Parliament on Wednesday.
The Greek government is set to find out this week what the institutions think about the package of positive measures submitted to Parliament on Monday and due to be voted into law by Wednesday.
There has been a highly sceptical reaction from the institutions to the fiscal expansionary measures announced by the Greek government this week, including a reduction to VAT rates and a bonus for pensioners.
The package of expansionary measures announced by Prime Minister Alexis Tsipras on Tuesday is due to be covered by the fiscal space the government expects over the coming years but also creates some doubt about the primary surplus targets agreed with the lenders.
The government is due to table in Parliament on Monday draft legislation paving the way for debts to the tax office, social security funds and municipalities to be settled in up to 120 monthly instalments.
Greece submitted on Thursday the Stability Programme for the 2019–2022 period in line with the requirements of the European Parliament and the Council regulations, which also corresponds to the national medium-term fiscal plan.
Greece has received the green light for the latest round of debt relief measures and is set to move ahead with plans to repay part of the loans it has received from the International Monetary Fund early.
The government is hoping in the coming days to wrap up draft legislation for the new payment schemes it wants to introduce for social security and tax debts.
The Greek government and the opposition have been given some encouragement in their goal to avoid the pre-legislated reduction of the tax-free threshold for incomes by European Commission vice president Valdis Dombrovskis.