One way Greece hopes to extricate itself from its economic crisis? Tax its news websites.

In pension reform law due to be voted upon by parliament next Thursday, the government has proposed raising a 21.5 percent levy on news portals’ online advertising income. The money would go in to an existing journalists’ pension fund.

Is that counterintuitive logic? After all, news websites depend on selling web ads to keep those journalists in jobs.

The Internet Advertising Bureau (IAB Europe) is up in arms, saying advertisers would merely switch their money away…

IAB Europe VP Kim Zorbas, who is Greek-German, tells paidContent:UK news sites would have to raise ad rates in response: “It’s anachronistic. It’s a very infant market, the government should be trying to encourage it. We would see a shift to non-news portals and even to aggregator portals.” Zorbas says he will lobby the European Commission, which has essentially enforced such reforms on Greece, to stop the measure.

From IAB’s announcement: “News portals which invest in the production of owned content will not only lose advertising revenue share but, as this is their most important - if not unique - source of income, their very existence may be threatened.”

The Greek online ad market pulled €70 million in 2009, IAB says - most of which comprised search ads.

Amongst measures to cut its 13.6 percent budget deficit along with a €110 billion IMF injection, Greece is reforming relatively generous public pension provisions…

Bloomerg: “Greek pensioners on average live on 96 percent of the salary they had when they worked, more than twice the proportion of earnings as Germans, according to the Organization for Economic Cooperation and Development.

“Pension reforms include increasing the retirement age to 65 from 60 for women, curtailing early retirement, increasing the number of contribution years and calculating payments over a longer period of employment.”

Perhaps the most interesting thing - Greece is not alone in Europe in proposing such a tax. In January, French president Nicolas Sarkozy welcomed a report commissioned by his government which proposed a levy of between one and two percent on companies’ internet advertising income there, aimed at essentially propping up France’s struggling commercial media and creative output.

Interpreted as a “Google (NSDQ: GOOG) tax”, it followed a 0.9 percent levy on ISPs and telcos that Sarkozy conceived to fund the removal of prime-time ads from state TV broadcaster France Televisions.

But the Greek rate of 21.5 percent is of a whole different order, and, whilst France wants to tax big foreign companies, Greece seems more inclined to tax indigenous news publishers.

Greece is already one of Europe’s tiniest online ad markets, taking only five percent of continent-wide spending. But this grew 40 percent through 2009, IAB’s Zorbas tells us - growth that could be capped if the law passes.

If the U.S. government taxed online ad income at 21.5 percent, it would have raised $4.9 billion last year - that figure (source: IAB/PwC) pertaining to the whole of the online ad market, rather than news portals alone.

The IAB says it’s not aware of any similar levy proposals around Europe.

{/exp:get_graph} {/exp:tweet_quote}