Greece is preparing a new debt-settlement framework aimed at helping around 1.5 million individuals and businesses with overdue debts to the tax authorities and the social security fund EFKA.

The bill, introduced by the Ministry of National Economy and Finance, comes as private debt in the country has climbed above €240 billion, adding pressure on households, professionals and small businesses already struggling with high costs and limited liquidity.

At the center of the package is a new extraordinary 72-installment arrangement for overdue debts to the Tax Administration and EFKA. The measure will apply to debts that became overdue up to and including Dec. 31, 2023.

Applications will be submitted electronically until Dec. 31, 2026. The online platform is expected to open by mid-July.

To qualify, debtors must meet specific conditions. They must either have no other overdue debts or have settled any additional overdue debts through the standing installment arrangement. They must also have submitted all income tax returns for the past five years, where the filing deadline had expired by Dec. 31, 2025. Those who have been irrevocably convicted of tax evasion or smuggling are excluded.

The minimum monthly installment will be €30, while the interest rate will remain fixed at 5.84% for the entire duration of the arrangement.

The arrangement will be lost if the debtor misses two consecutive monthly installments, delays payment of the final two installments by more than two months, fails to settle other overdue debts within one month, or creates new overdue debts and does not pay or regulate them within three months of the payment deadline.

Frozen Bank Accounts

The bill also introduces relief for taxpayers and businesses whose bank accounts have been frozen because of overdue debts.

Under the new provisions, debtors will be able to unblock frozen accounts by paying 25% of the total amount owed and settling the remaining balance through an installment arrangement.

The option will be available only once. Its purpose is to preserve a minimum level of liquidity, especially for small and medium-sized enterprises and self-employed professionals who need access to funds to cover basic operating costs.

The government is also raising the protected amount in bank deposits from €1,250 to €1,600 for debts owed to the state and banks.

The measures form part of a broader attempt to manage Greece’s large stock of private debt, while giving viable households and businesses another chance to regularize their obligations and avoid further enforcement action.