Greece denies plan for retroactive tax on foreign bondholders

ATHENS Thu May 15, 2014 10:37am EDT

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ATHENS May 15 (Reuters) - Greece's government on Thursday denied it had instituted a retroactive tax on foreign holders of Greek bonds, saying capital gains booked from early 2012 to the end of last year were subject to the tax regime covering that period.

Greek 10-year bond yields GR10YT=TWEB rose to near two-month highs on Thursday, with traders citing a document detailing a retroactive tax on non-resident holders of Greek bonds.

Greek officials, however, said that document had only sought to clarify that the previous tax regime of 33 percent on foreign legal entities and 20 percent on individuals had been abolished starting this year.

"There is no taxation on capital gains from transfers of Greek government bonds by foreign investors that took place from January 1, 2014 onwards," a statement from the finance ministry said. "Consequently, the reports referring to retroactive taxation or intention for retroactive taxation are completely untrue." (Reporting by Lefteris Papadimas, writing by Deepa Babington)

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Comments (17)
DSV1 wrote:
Since when did the Democratic Party ship members over to Greece?

May 15, 2014 11:24am EDT  --  Report as abuse
MoreFreedom wrote:
Governments: torn between taking money from people to satisfy their constituents and their desire to spend money, and their ability to borrow from others to also fund their spending.

It appears cooler heads prevaled in Greece, because it’s more dependent on borrowing, that will dry up if they start reneging on their agreement in selling the bond, by taking part of the capital from their bondholders.

But I wouldn’t put it past Greek voters to vote for it. The tribal instinct still reigns in most of the world, and doing to the other tribe something you wouldn’t do to your own countrymen or tribe, is a common sentiment. And it’s partly a consequence of government taking from some and giving it to others: if they can take theirs by force, then I can take mine by force as well. Which is another battle between those with political power, and those without.

May 15, 2014 11:29am EDT  --  Report as abuse
JerseyDave wrote:
Why would anyone still own Greek bonds? Still, like a slow motion car crash that keeps going. We should watch these tactics though, in Greece and Cyprus, because they may one day be used here if the same crowd of folks keeps running things here.

May 15, 2014 11:59am EDT  --  Report as abuse
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