Greek VAT Reductions Aims to Increase Tourism
With only two weeks before the European Parliament elections take place (26th May), Greek Prime Minister Alexis Tsipras has announced a proposal featuring a number of significant tax reductions for Greek businesses, with the focus clearly being on increasing tourism to the country.
Set to be introduced in late 2019 (and being fully implemented in 2021), Tsipras has proposed the reduction of value-added tax (VAT) on tourism focused industries such as restaurants and hotel accommodation. The largest impact may be seen through VAT on food and drinks being reduced from 24% to 13%, and replicated on goods/services, including hotel stays, dropping from 13% to 11% – both key factors in tourism.
More specifically, the goods which will be reduced to 13% VAT include food & drink sold in all restaurants or food services, cafes & bakeries, as well as a number of food items such as sugar, ice cream, and coffee. Alexis Tsipras has claimed these VAT cuts will have a national total benefits package of €1.3 billion by the year 2020.