Governor of Ionian Isles Calls for Equal Tax Treatment

Ithaki Island. Photo © Maria Theofanopoulou

Representing the Ionian islands, the regional governor Theodoros Galiatsatos is calling on the government to extend the special reduced VAT rate applicable on the Aegean islands to apply to the Ionian and remaining isles of the country as well.

In his letter to Prime Minister Alexis Tsipras and to his ministers, Mr Galiatsatos refers to a controversial government proposal made earlier this year — prompted by its international lenders — to increase VAT on tourism and slash lower rates currently applicable. He adds that this provides the opportunity to make a right wrong by including the Ionian islands in future decisions regarding the special tax status. Also known in Greek as the “Eptanisa” or seven islands, the Ionian isles are: Corfu, Paxi, Lefkada, Ithaki, Kefalonia, Zakynthos and Kythira.

Despite the fact that the islanders of the Ionian are also suffering from the crisis, they do not enjoy the advantages of lower VAT rates applicable elsewhere, he adds.

Mr Galiatsatos points to the decline in the number of ferries serving the islands, which has resulted in making it harder to visit the Ionian region and leading to dropping tourist figures.

The regional governor concludes that should the government proceed with the proposed tax hike on tourism from 6.5 percent to 13 percent, the sector will suffer devastating results, citing among others SETE (Greek Tourism Confederation) figures that up to 73,000 jobs stand to be lost.