Photo: Getty Images
ATHENS, Greece (AP) — A Greek high court ruled that a controversial property tax imposed last year by the government on homeowners and charged through their electricity bills is constitutional, but cutting off the electricity for nonpayment is not, court officials said Friday.The Council of State, Greece’s highest administrative court, heard the case brought by several professional and citizens’ groups last November and ruled Friday, according to court officials. The decision was taken by a “very large majority,” a court official said on condition of anonymity, because the ruling has not been formally announced.
The imposition of the tax last September had raised an outcry in crisis-ridden Greece last year, but despite widespread calls for disobedience, the government has collected more than euro2 billion ($2.64 billion) from the tax, which homeowners paid in two installments.
The court found that the tax is constitutional, because it is an emergency levy with a specific period of application: the government has said the tax will apply in 2011 and 2012. The Council of State ruling leaves open a reopening of the case if the government decides to make the tax permanent.
On the issue of nonpayment, the court ruled that, according to European Union regulations, customers cannot have their electricity supply cut for nonpayment of taxes. The ruling directs the state to find other forms of sanctions for nonpayment, such as fines.
In a country wracked by almost daily protests against painful austerity measures, the government’s announcement of the tax in September 2011 hit a particularly raw nerve. Including it on electricity bills was meant to make it easier for the state to collect — especially with the added threat of power cuts for those failing to pay.
Furious at a plan they said turned them into backup tax collectors, state power company workers vowed to prevent people having their electricity cut off — or, failing that, to reconnect vulnerable groups such as the elderly, unemployed or infirm if the state electricity company did flick off the switch.
Some municipalities followed suit, urging their citizens not to pay the property tax, but just the portion of their bill related to power consumption.
The court’s ruling is expected to affect thousands of cases brought by citizens against the property tax. In the few cases decided, lower courts have ruled in favour of the citizens, but the higher court’s ruling is now binding.
NOW WATCH: Briefing videos
Business Insider Emails & Alerts
Site highlights each day to your inbox.