Greece's New Austerity Measures

ATHENS, Greece – Greece has announced a new euro4.8 billion (US$6.5 billion) austerity package to deal with the financial crisis. Here is a summary of some of the key measures:

—Cuts of up to 8 percent in public servants' income through reductions in basic pay and bonuses, including 30 percent cuts on holiday bonuses, saving euro1.1 billion ($1.5 billion).

—Raising general sales tax from 19 to 21 percent to increase revenues by a projected euro1.3 billion ($1.77 billion).

—Luxury tax on yachts, private jets, jewelry, high-end automobiles, leather goods and other articles. Taxes also increased on gasoline, cigarettes and alcohol. Total revenue increase of euro850 million ($1.16 million).

—Top-up income tax of 1 percent for Greeks who reported annual income of euro100,000 ($136,500) or higher in 2009. General income tax rate will also be raised to 45 percent for Greeks in that income bracket.

—Freeze in pensions, saving euro450 million ($614 million).

—Cuts of euro500 million ($682 million) in public investment program.

—New austerity measures to raise total euro2.4 billion ($3.27 billion) in taxes and cut the same amount in spending, raising overall savings in 2010 to euro16 billion ($21.83 billion).