Greece’s government is introducing a comprehensive set of incentives to promote the growth and competitiveness of small and medium-sized enterprises (SMEs). The new framework includes a significant increase in tax breaks for research and development (R&D), a reduction in the minimum capital required for business mergers, and a tripling of investment limits for angel investors in startups.
According to the Ministry of National Economy and Finance, the plan aims to foster more mergers and transformations among the roughly 800,000 active SMEs in Greece, 95% of which have fewer than 10 employees. By encouraging these businesses to merge, the government hopes to reduce their tax burden and enhance their sustainability over the long term. The new tax system, which also raises the minimum income SMEs must declare, is expected to drive these mergers, potentially offering up to €125,000 in benefits over nine years.
One key aspect of the plan is to strengthen the collaboration between larger companies and Greece’s startup ecosystem. The incentives for mergers include a reduced minimum corporate capital limit for merged companies, the ability to transfer tax losses, and extended tax exemptions for capital gains.
In addition, the government is expanding tax incentives for angel investors, allowing them to deduct up to 50% of their capital contributions to startups from their taxable income. The maximum investment eligible for this deduction is now set at €900,000 per year, spread across up to three different startups.
The tax breaks for R&D activities are also being significantly enhanced, with deductions potentially increasing from 250% to 315% for collaborations with startups, research centers, and knowledge-intensive SMEs. This is part of a broader effort to close the gap between Greece and the European average in terms of R&D investment.
