(26 June 20h00) List which takes account ofthe proposals ofthe Greek authorities received on 8, 14, 22 and25 June

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Tab le I G reece ; P r ro r Ac t t ons

Policy Actions to be taken in consultation with ECIECBIMF staff:

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1. 2015 supplementary budget and 2O16-19 MTFSAdopt effective as of July L,2015 a supplementary 20L5 budget and a 201-6-19 medium-term fiscal strategy,supported by a sizable and credible package of measures. The new f iscal path is premised on a primary surplus targetof L,2,3, and 3.5 percent of GDP in 2015, 2016,20L7 and 2018. The package includes VAT reforms (112), other taxpolicy measures (113), pension reforms (114), public administration reforms (115), reforms addressing shortfalls in taxcollection enforcement (116), and other parametric measures as specified below.r . \ L (( 5, (,'bt5) aorn--r:'1"1 r,*., b,) 2. vAT reform C " f.

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reduce the expenditure cei l ing for mil i tary spending by 400 mil l ion with a targeted set of act ions, including areduction in headcount and procurement;

introduce reform of the income tax code, inter alia covering capital taxationl, investment vehicles, farmers and the

ArF f ?-s.r &!fl- A&?tq,2vY6tu gg / \ announce international publ ic tender for the acquisit ion of television l icenses and usaqe related fees of relevantrrequencies; (Sto6*ur6!ro! bq \r) ts\esr\u,rr; ,lhe7extend implementation of luxury tax on recreational vessels in excess of 10 meters and increase the rate from Llo/otol3o/o,comingintoeffectfromthecollect ion of 20L4incometaxesandbeyond; GV(rOaAX t3'1. \_evextend Gross Gaming Revenues (GGR) taxation of 30% on VLT games, expected to be installed at second half of2015 and 20L6; and a

o launchthetenderprocessfortheissuinsof4Gand5Glicences. C NUr"gXn S,Or\tU,41- 4r-u ''-+"0r, S-q )4. Pension reform

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Effective from July 1, 2015 the authorities will phase-in reforms that would deliver estimated permanent savings of %-% percent of GDP in 2015 and 1 percent of GDP on a ful l year basis in 2016 and thereafter by adopting legislat ion to:. create strong disincentives to early retirement, including the adjustment of early retirement penalties, and

through a gradual elimination of grandfathering to statutory retirement age and early retirement pathwaysprogressively adapting to the limit of statutory retirement age of 67 years, or 62 and 40 years of contributions by2022, applicable for all those retiring (except arduous professions, and mothers with children with disability) with

self- employed, etc.;

raise the corporate tax rate from 26/o to 28%;

introduce tax on television advertisements; &O pO, Q," G'l$cR;

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auditorrices byJanuary rori"'/nitras*-61.; *; d,lirI;;Xi; bulr"S;*l-r,l*; q "? tZrt-rr.4.rZ..b increase the rate of the tonnage tax and phase out special tax treatments of the shipping industry.u_B 5- A.K-.1$"t

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develop the tax framework for col lect ive investment vehicles and their part icipants consistently with the ITC and in

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' ' Xve k*Wlexclusive f inancial service caoacitv and GAO Dowers to oversee public sector f inances; and ( iv) phase out f iscal O I

BySeptember2015, ( i )s imp l i f y thepersona l incometaxcred i tschedu le ; ( i i ) re -des ignand in tegra te in to the ITCthe C l ) 0&d i r r t ' l l u " , tu , ,Z r , , tu 'sof idari ty surcharge for income of 2OL6 to more effect ively achieve progressivity in the income tax system; ( i i i ) issue a OOr,, , ,^s ( l t i

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c ircular on f ines to ensure the comprehensive and consistent appl icat ion of the TPC; ( iv) and other remaining reforms I i \ ' 2 :"Y .q,) \rp0 /

as speciried in 1re or the rMF country Reporr No. 14i1s1.&r c'Q^f(j\; Ollt\Tr\rr"> 6Zov -qbp*- L::&ihq Lwq \-0On heafth care, effect ive as of July 1,,201-5,( i) re-establ ish ful l INN prescript ion, without exceptions, ( i i ) reduce as a f irst

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step the price of al l off-patent drugs to 50 percent and al l generics to 32.5 percent of the patent price, by repealingthe grandfathering clause for medicines already in the market in 2012, and ( i i i )) review and l imit the prices of ^ 'd iagnos t ic tes ts tobr ings t ruc tura l spend ing in l inewi thc lawback targe ts ; and( iv ) co l lec t in the fu l l the2014c lawback Ar .^^ " ' , . . ^Jfor private cl inics, diagnostics and pharmaceuticals, and extend their 2015 glawback cei l ings to 2016. Lo.rv Z4 Fdrr t :-- ' ' f - % f 'N

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immediate appl icat ion;

adopt legislation so that withdrawals from the Social Insurance Fund will incur an annual penalty, for thoseaffected by the extension of the retirement age period, equivalent to L0 percent on top of the current penalty of 6percenr;

integrate into ETEA all supplementary pension funds andrensure that, starting Januarv t.2015. all suoolementarypension funds are only financed by own contributions; 6tO ll.rf - g f S t4

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. better target social pensions by increasing oGA uninsured pension; ArA" +f 2,6p-7a-Zur, ASpoz"t( \ r J lr^\or, h 6"A 6ox\?-.s tbA

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merged into other funds. The consolidation of social insurance funds will take place by end 2017. In 2015, the processwil l be activated through legislat ion to consolidate the social insurance funds under a single enti ty and the operationalconsolidation will have been completed by 31 December 2016. Further reductions in the operating costs and a moreeffective management of fund resources including improved balancing of needs between better-off and poorer-offfunds will be actively encouraged.

The authorities will adopt legislation to fully offset the fiscal effects of the implementation of court r.r"l,ng, on the 2012oension reform.

In parallel to the reform of the pension system, a Social Welfare Review will be carried out to ensure fairness of thevarious reforms.

The institutions are prepared to take into account other parametric measures within the pension system of equivalenteffect to replace some of the measures mentioned above, taking into account their impact on growth, and providedthat such measures are presented to the institutions during the design phase and are sufficiently concrete andquantifiable, and in the absence of this the default option is what is specified above.

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5. Public Administration, Justice and Anti Corruption

Adopt legislation to:

. reform the unified wage grid, effective 1January, 2016, setting the key parameters in a fiscally neutral manner andconsistent with the agreed wage bill targets and with comprehensive application across the public sector,including decompg:ssing the wage distribution across the wage spectrum in connection with the skill,performance and responsibility of staff. (Ihe authorities will also adopt legislation to rationalise the specialisedwage grids, by end-November 2015);

o align non-wage benefits such as leave arrangements, per diems, travel allowances and perks, with best practices inthe EU, effective 1 January 2016;

establ ish within the new MTFS cei l ings for the wage bi l l and the level of publ ic employment consistent withachieving the fiscal targets and ensuring a declining path of the wage bill relative to GDP until 2019;

hire managers and assess performance of all employees (with the aim to complete the hiring of new managers by

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31 December 2015 subsequent to a review process).reform the Civil Procedure Code, in line with previous agreements;

strengthen the governance of ELSTAT. I t shal l cover ( i) the role and structure ofthe Advisory bodies oftheHellenic Stat ist ical System, including the recasting of the Counci l of ELSS to an advisory Committee of the ELSS,and the role of the Good Practice Advisory Committee (GPAC); (ii) the recruitment procedure for the President ofELSTAT, to ensure that a President of the highest professional calibre is recruited, following transparentprocedures and selection criteria; (iii) the involvement of ELSTAT as appropriate in any legislativ"e or other legalproposal pertaining to any statistical matter; (iv) other issues that impact the independence of ELSTAT, includingfinancial autonomy, the empowerment of ELSTAT to reallocate existing permanent posts and to hire staff where itis needed and to hire specialised scientific personnel, and the classification of the institution as a fiscal policy bodyin the recent law 4270/2014; role and powers of Bank of Greece in statistics in line with European legislation.

Publish a revised Strategic Plan against Corruption by 3L July 2015. Amend and implement the legal framework for thedeclarat ion of assets and f inancing of the pol i t ical part ies and adopt legislat ion insulat ing f inancial cr ime and anti-corruption investigations from political intervention in individual cases.

Take the following actions to:. Adopt legislation to establish an autonomous revenue agency, that specifies: (i) the agency's legal form,

organization, status, and scope; ( i i ) the powers and functions ofthe CEO and the independent Board ofGovernors; ( i i i ) the relat ionship to the Minister of Finance and other government enti t ies; ( iv) the agency's humanresource f lexibi l i ty and relat ionship to the civi l service; (v) budget autonomy, with own GDFS and a new fundingformula to align incentives with revenue collection and guarantee budget predictability and flexibility; (vi)reporting to the government and parliament; and (vii) the immediate transfer of all tax- and customs-relatedcapacities and duties and all tax- and customs-related staff in SDOE and other entities to the agency.

on garnishments, adopt legislat ion to el iminate the 25 percent cei l ing on wages and pensions and lower al lthresholds of L,500 while ensuring in all cases reasonable living conditions; accelerate procurement of [Tinfrastructure to automatize e-garnishment; improve tax debt write-off rules; remove tax officers' personall iabi l i t ies for not pursuing old debt; remove restr ict ions on conducting audits of tax returns from 2012 subject tothe external tax certificate scheme; and enforce if legally possible upfront payment collection in tax disputes.

amend ( i) the 2014-15 tax and SSC debt instalment schemes to exclude those who fai l to pay current obl igations

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8. l-abour market

SiltXf krV Launch a consultation process similar to that foreseen for the determination of the level of the minimum wage (ArtU 103 of Law 4L72/20L3) to review the existing frameworks of collective dismissals, industrial action, and collective

Itbargaining, taking into account best practices elsewhere in Europe. Further input to the review described above willbe provided by international organisations, including the ILO. The organization and t imelines shal l be drawn up inconsultation with the institutions. No changes to the current collective bargaining framework will be made prior tothe conclusion of the review and in any case not before end-2015. Any proposed changes to the legislativeframeworks will only be adopted in agreement with the ECIECBIMF. The authorities will take actions to fightundeclared work in order to strengthen the competitiveness of legal companies and protect workers as well as taxand social security revenues.

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Adopt lesislation to: aL C Xaz("r ealc"lJt-^ u" IC;' impfement all the pending recommendations of the OECD competition toolkit I, including inter olia truck licenses,

and the oEcD toolkit I I recommendations on beverages and petroleum producrs;

On electricity markets, the authorities will reform the capacity payments system and other electricity market rules toavoid that some plants are forced to operate below their variable cost, and to prevent the netting of the arrearsbetween PPC and market operator; set PPC tariffs based on costs, including replacement of the 20% discount for HVusers with cost based tariffs; and notify NOME products to the European Commission. The authorities will alsocontinue the implementation of the roadmap to the EU target model prepare a new framework for the support ofrenewable energies and for the implementation of energy efficiency and review energy taxation; the authorities willstrengthen the electr ici ty regulator 's f inancial and operational independence;

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10. Privatization

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