ATHENS, July 10 -- The Greek government's proposal for a debt deal with lenders to avoid a looming bankruptcy and Grexit was submitted late Thursday night to the institutions and the Greek parliament.

The new policy commitments and actions to be taken in consultation with the institutions foresee primary surplus targets of 1, 2, 3 and 3.5 percent of GDP in 2015, 2016, 2017 and 2018 respectively.

In addition, the package Athens proposes in exchange for further international financing over the next three years includes a VAT reform, other tax policy measures, pension reforms, public administration reforms, reforms addressing shortfalls in tax collection enforcement and privatizations.

Regarding the thorny issue of VAT reform in the six-month negotiations with creditors, Athens pledges to adopt legislation that will be effective as of July 1, 2015. The reform will target a net revenue gain of 1 percent of GDP on an annual basis from parametric changes. The new VAT system will unify the rates at a standard 23 percent rate, which will include restaurants and catering, and a reduced 13 percent rate for basic food, energy, hotels, and water (excluding sewage), and a super-reduced rate of 6 percent for pharmaceuticals, books, and theater.

The reform also foresees the elimination of discounts on islands, starting with the islands with higher incomes and which are the most popular tourist destinations. As to fiscal structural measures, the government proposed to adopt legislation to increase the corporate tax rate from 26 percent to 28 percent, to phase out the preferential tax treatment of farmers, raise the solidarity surcharge, increase the rate of the tonnage tax and phase out special tax treatments of the shipping industry.

The proposal also foresees among others the reduction of the expenditure ceiling for military spending by 100 million euros in 2015 and by 200 million euros in 2016. On pension reform, another thorny issue, the Greek government pledged a new pension reform in October 2015 that will create strong disincentives to early retirement.

On public administration, justice, anti corruption and tax reform, it pledged actions to increase transparency in the functioning of tax and customs authorities, as well as actions to combat fuel smuggling and tax evasion. With regard to labor market and product market, the Leftist government promised to launch a consultation process to review the whole range of existing labor market arrangements, taking into account best practices elsewhere in Europe and adopt legislation to open the restricted professions of engineers, notaries, actuaries, and bailiffs and liberalize the market for tourist rentals, among other measures.

Finally, on privatizations, the government pledged to facilitate the completion of tenders for regional airports, the railways network operator TRAINOSE, Egnatia national highway, the ports of Piraeus and Thessaloniki, and the Hellinikon Athens former airport. The government and the Greek privatization fund HRADF will announce binding bid dates for Piraeus and Thessaloniki ports of no later than end-October 2015, and for TRAINOSE ROSCO, with no material changes in the terms of the tenders.

Reacting to the revealed draft proposal, analysts in Athens said it was close to the draft proposal creditors had submitted in late June that was rejected by the government and Greek people in the July 5 referendum as "extremely harsh and unsustainable." As the Euro Working Group will be assessing it on Friday, Greek lawmakers will be asked to authorize the government to negotiate with the country's lenders, based on its content, government sources told Greek national news agency AMNA.

After the negotiation is concluded, the final document will be submitted to the Greek parliament for approval, making it a state law. Greece has been given an ultimatum by eurozone partners earlier this week to submit credible and comprehensive proposals for new reforms for cash bailout by this weekend.

This Sunday's extraordinary eurozone and EU summits will either seal a deal or show Greece the exit from the European common currency zone, officials and analysts have warned.