EU urges Greece to accelerate reforms in taxation, energy and infrastructure

The European Commission has issued fresh recommendations to Greece, urging the country to accelerate reforms in taxation, energy, and infrastructure as part of the EU’s annual economic governance cycle. The proposals, approved by the Ecofin Council on Friday, call for broader tax bases, reduced fossil fuel subsidies, and faster implementation of structural changes to improve competitiveness and social equity.
In its 2026 country-specific recommendations, the Commission highlights Greece’s progress in macroeconomic stability but warns that lingering distortions—such as widespread tax evasion in sectors like unregistered trade and services—continue to undermine growth. Among the most contentious measures is a demand to reassess 1,236 tax exemptions that were in place in 2025, though Greek officials have insisted these are necessary and will not be abolished. “They are all essential and necessary,” a finance ministry source told *Newmoney.gr* .
The recommendations also target Greece’s energy sector, pushing for higher taxes on fossil fuels and private insurance premiums for natural disasters to incentivize the shift toward electric vehicles. The Commission argues that these adjustments would align with broader EU climate goals while addressing Greece’s vulnerability to extreme weather events. “The package touches everything from taxation to railway infrastructure and from electromobility to water management,” the report states .
The timing of the recommendations is politically sensitive, coming as Greece faces parliamentary elections in late 2026. While the Commission’s suggestions are non-binding, they set the stage for future policy debates and could influence the next government’s agenda. Analysts note that Greece’s progress in exiting its macroeconomic adjustment program has been uneven, with structural reforms lagging behind fiscal consolidation.
The recommendations follow a pattern seen across the EU, where the Commission is increasingly using its annual economic governance cycle to push for deeper structural changes. For Greece, the focus on tax reform and energy transition reflects broader EU priorities, but the political feasibility of implementing these measures remains uncertain. “Behind the praise for economic progress, there are warning bells ringing for structural reforms that may yet emerge,” the Commission’s report cautions .
The Commission’s proposals will now be discussed with Greek authorities, with implementation expected to begin in the coming months. While the recommendations are advisory, failure to address the highlighted distortions could complicate Greece’s access to EU funds and its long-term economic stability.
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