Greece Announces 2026 Tax Cuts for Families and Youth

The Greek government has announced a comprehensive tax reduction plan for 2026, focusing on stimulating the economy through relief for families and younger workers. The core of the new policy is a reduction of two percentage points applied to most income tax rates currently in effect.

Beyond the general rate reduction, the plan introduces targeted relief for specific demographics. Most notably, individuals under the age of 25 will be completely exempt from income tax on earnings up to €20,000. Additional breaks have also been rolled out specifically for families with children, further reducing the tax burden on parents. These measures are intended to support economic growth by increasing the disposable income of younger workers and families.

Athens has officially lowered most income tax rates by two points as part of a broader economic strategy. This general reduction applies to the majority of income brackets, providing widespread relief to the working population. The decision to lower these rates is a central component of the government's 2026 fiscal plan, aimed at boosting consumer spending and economic stability.

The policy changes were rolled out to provide extra breaks specifically tied to children and younger workers. By adjusting the tax code to favor these groups, the government is attempting to address specific economic pressures. The reduction in general tax rates serves as a baseline for the additional, more targeted relief measures introduced alongside it.

A significant portion of the tax relief package is dedicated to younger workers entering the labor market. The government has introduced a provision that eliminates income tax entirely for under-25s who earn up to €20,000. This measure is designed to encourage youth employment and financial independence by allowing them to keep more of their earnings.

This specific tax break highlights the government's focus on supporting the economic entry of the younger generation. By removing the tax burden on the first €20,000 of income for this demographic, Athens hopes to make the workforce more attractive to young people and provide them with greater financial flexibility during the early stages of their careers.

In addition to the measures for youth, the tax plan includes extra breaks for families. These incentives are directly linked to the number of children a family has, offering a reduction in tax liability for parents. This approach aims to alleviate some of the financial pressures associated with raising children.

The inclusion of family-specific tax relief complements the cuts for young workers, creating a multi-faceted approach to economic stimulus. The government is utilizing the tax code to provide support to what it views as key demographic groups, hoping to foster a more robust domestic economy through targeted fiscal policy.

The collective impact of these tax cuts is expected to be significant for the Greek economy. Lowering the tax burden on a broad scale increases the amount of money available for consumption and investment. The specific targeting of families and youth suggests a strategic focus on segments of the population that are vital for long-term economic health and growth.

These fiscal changes represent a shift in policy priorities for Athens. By combining general rate reductions with targeted exemptions, the government is attempting to balance broad economic stimulation with specific social policy goals. The success of these measures will likely be closely monitored as they take effect in 2026.