ELAM Proposes Expanding Tax Neutrality for NPL Restructuring

ELAM MPs have submitted a bill to amend the Income Tax Law, aiming to expand the framework of tax neutrality for the restructuring of non-performing loans. The proposal concerns loans regardless of whether they were granted before December 31, 2015.

MPs Christos Christou, Linos Papagiannis, and Sotiris Ioannou submitted the proposal to parliament on Thursday. According to the explanatory report, the condition that the initial disbursement of the loan must have taken place at least three years before the restructuring agreement prevents abusive practices.

The regulation, which was implemented until 2017, contributed to accelerating restructurings, reducing NPLs, facilitating sustainable solutions for borrowers, protecting primary residences, and strengthening financial stability.

The proposed regulation acts as a counterweight to the foreclosure mechanism, offering a fair way to service obligations without losing assets.