Tourism Sector Opposes 15% VAT Plan

The increase of the Value Added Tax to 15 percent would be disastrous for Greek tourism, the Association of Greek Tourism Enterprises (SETE) said recently in response to conflicting statements made by government officials in regards to the possible imposition of a single VAT rate of 15 percent for all products and services.

Such an imposition would increase the 9 percent VAT rate (charged today to certain businesses including tourism enterprises) to 15 percent and reduce the 19 percent VAT rate (charged to products and specific services).

Specifically, Finance Ministry General Secretary Dimitris Georgakopoulos had mentioned in an interview to a Greek radio station that a proposal for a uniform VAT rate was “under discussion.” Government spokesman Giorgos Petalotis contradicted him later.

“The government is not considering to impose a single VAT rate of 15 percent. There is no such suggestion,” Mr. Petalotis stressed to the Greek press when asked whether the government favors such a measure.

However, Greek Economy, Competitiveness and Shipping Minister Louka Katseli had also stressed that the issue “would be put to deliberation.”

In an announcement, the Association of Greek Tourism Enterprises (SETE) urged the government to keep its promises in regards to a stable fiscal framework and to avoid surprise decisions.

The Hellenic Federation of Hoteliers said that it is “inconceivable” that in a time when Greece’s competitors within the euro zone maintain the VAT on low levels, for Greece to even discuss VAT increases for hotel businesses.