Greek lawyer Georgios Matsos has accused Prime Minister Kyriakos Mitsotakis of abandoning key tax reform pledges as public spending surges toward 2026. Writing ahead of the annual Thessaloniki International Fair, Matsos argued that the conservative government has lost its economic vision and burdened citizens with persistent bailout-era taxes.
In an opinion article published by financial news outlet Capital.gr on Thursday, August 27, 2026, Matsos called on Mitsotakis to apologize during his upcoming address at the fair for failing to deliver on his 2019 Truth Agreement with businesses and workers. The Thessaloniki International Fair is traditionally the platform where Greek prime ministers outline economic policy for the coming year.
Matsos detailed how Mitsotakis had pledged before his 2019 election victory to reduce taxes and social security contributions, improve liquidity, and enhance the business environment. In return, business owners were expected to invest in Greece, pay their taxes and contributions, protect the environment, and support employees.
According to the lawyer, Mitsotakis had described growth as a prosperity policy for the many, particularly vulnerable citizens, calling it a chain of good and the primary mechanism to stem youth emigration while building a self-reliant nation. Glimpses of those early reforms enabled Mitsotakis and his New Democracy party to secure re-election in May and June 2023.
Matsos noted that despite the fatal Tempi train crash in central Greece in February 2023, 41 percent of voters supported the government because they believed only Mitsotakis could modernize the national railway network.
To illustrate his point, Matsos recalled a conversation from the early 1990s with a university classmate affiliated with PASP, the student wing of the Panhellenic Socialist Movement (PASOK). When asked why he supported PASOK, the classmate insisted that party founder and former Prime Minister Andreas Papandreou was the only leader with a clear vision.
Matsos stated that while Papandreou damaged the economy outside of the 1993 to 1995 period, his clear vision successfully rallied voters, drawing a parallel to the political support Mitsotakis commanded during his first four-year term.
Tax burdens on small businesses
Matsos stated that the government reversed its earlier success during its second term, leaving citizens in conditions of financial suffocation. He pointed out that the trade tax remains active for corporations, while self-employed individuals and sole proprietors have seen it replaced by a minimum imputed income system.
Citing recent articles by columnist Agis Veroutis, Matsos argued that these tax policies exclusively harm lower-income citizens and small enterprises. The lawyer highlighted that multiple emergency taxes introduced during Greece's debt crisis remain in effect, noting that the ENFIA property tax still applies to primary residences where a 30 percent reduction offers insufficient relief.
Furthermore, the Special Consumption Tax on fuel introduced under former Prime Minister George Papandreou remains unnaturally high. Matsos warned that the fuel tax directly impairs corporate competitiveness and serves as a primary driver of lucrative fuel smuggling.
Matsos criticized top personal income tax rates, stating they remain far above the 40 percent rate for wage earners and 33 percent rate for the self-employed achieved under former Prime Minister Antonis Samaras, as well as the 35 percent rate recorded in 2009.
He also highlighted the decision to raise value-added tax on served beverages to 24 percent, which penalizes small and medium-sized cafes employing waiters while favoring large takeaway chains. In addition, Matsos criticized the government's MyDATA digital accounting platform, describing it as a major obstacle to private investment that damages the business environment for smaller firms.
Surging state spending and budget deficits
To demonstrate the absence of economic vision, Matsos contrasted budget figures from 2014 with projections for 2026. Citing page 137 of the 2026 budget, he noted that primary state spending, excluding debt interest payments and the Public Investment Program, is projected to reach 61.4 billion euros in 2026.
This represents a 19.5 billion euro or 46.54 percent increase compared to the 41.9 billion euros spent in 2014. Over the same period, net tax revenue is forecast to rise from 40.9 billion euros in 2014 to 73.6 billion euros in 2026, marking an increase of 32.7 billion euros or 79.95 percent, citing page 104 of the 2026 budget and page 61 of the 2016 budget final report.
Meanwhile, Greece's Gross Domestic Product is projected to grow from 177.56 billion euros in 2014 to an estimated 260.03 billion euros in 2026, an expansion of 46.45 percent.
Matsos argued that matching primary spending growth to GDP growth is unjustifiable, given past pension cuts under the Katrougalos pension law and modest public sector wage increases. He recalled that primary spending stood at 57.99 billion euros in 2009 when the state paid monthly pensions of 3,000 euros 14 times a year to 45-year-old retirees, noting that the Greek public bled to reduce that figure to 41.9 billion euros by 2014.
Economic outlook and social pressures
The lawyer argued that taxpayer money is failing to return to the economy, claiming that Greece would experience near-negative underlying growth without external cash inflows. Specifically, he pointed to 7.192 billion euros expected from the European Union Recovery and Resilience Facility in 2026 alongside revenue from selling Greek real estate to foreign buyers.
Matsos warned that government economic giantism drains liquidity and resources from ordinary citizens without creating broader prosperity. Concluding his analysis, Matsos stated that any minor relief measures announced at the Thessaloniki International Fair, such as small monthly gains of 18.26 euros, will fail to relieve pressure inside a boiling social pressure cooker that currently lacks a visible outlet.
