December 15, 2011 / 2:53 PM / 7 years ago

Greek property tax take suggests targets to be met

* Greece to raise 2 bln eur from tax, higher than 1.7 bln target-PPC source

* Power utility PPC is raising the tax on behalf of the government

* PPC has to refinance 1.2 bln euros of debt next year- PPC’s CEO

ATHENS, Dec 15 (Reuters) - Greece looks set to exceed its revenue targets from a property tax which has provoked popular protests, an official at the Greek power utility PPC which is collecting the tax said on Thursday.

A total of 650 million euros of the tax have been collected so far, suggesting the final take may breach the government’s initial goals, said the official who declined to be named.

“This (figure) means that the government will meet its 1.7 billion euro revenue target for this year, probably hitting 2 billion,” he said.

PPC is collecting the tax through electricity bills under the threat of cutting consumers’ power if they fail to comply. But despite the protests, only about a fifth of households are in arrears - the usual rate for all PPC bills, the official said.

Cash-strapped Greece imposed the tax in September in a desperate move to meet its budget deficit targets under an EU/IMF bailout. Interim budget figures published on Tuesday suggest that Greece will still miss its target to narrow the deficit to 9 percent of GDP this year from 10.6 percent in 2010 due to a deeper-than-expected recession.

PPC is also struggling from the recession. The state-controlled company has reported its first loss in almost two years for the third quarter, due to falling electricity demand and rising generation costs.

“The fourth quarter looks as bad as the third one,” PPC’s chief executive Arthouros Zervos told reporters on the sideline of an Athens conference.

PPC, 51-percent owned by the government, has also been hurt by the country’s sovereign debt crisis. The company is holding talks with banks to refinance 1.2 billion euros of debt maturing next year, about 700 million euros of which will fall due by the end of the first quarter, Zervos added.

PPC hopes that Greece will approve later this month electricity price increases that will help the company cope with recession. Energy Minister George Papaconstantinou told the same conference earlier on Thursday that the new prices will be announced within the next 10 days.

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