Greece's parliament on Friday approved legislation that cuts taxes for corporations and individuals by about 1.2 billion euros, as part of government measures to attract investments and lighten the burden on taxpayers.

The conservative government, which came to power in July, hopes to attract foreign investment to cement the country's

recovery after a decade-long debt crisis that shrank its economy by a quarter.

The legislation cuts the corporate tax rate to 24% from 28% and lowers tax on dividends to 5% from 10%. It scraps value-added tax on new construction and capital gains tax on real estate sales, in a bid to boost the sector. "The bill seeks the strengthening of the economy and investments," Finance Minister Christos Staikouras told lawmakers. "(It) also lightens taxes for households."

The bill reduces the tax rate for individuals to 9% from 22% for incomes up to 10,000 euros and by 1 percentage point for incomes of more than 20,000 euros. It also includes incentives to wealthy individuals to move their tax residence to Greece and exempts EU holders of Greek corporate bonds from any tax on earned interest.

Speaking in parliament, where the ruling conservatives have a majority of 165 lawmakers in the 300-seat house, Staikouras said the government plans to disburse a one-off outlay of 700 euros to 250,000 low-income families this year.