Extra Tax Measure Sparks Reaction in Greek Hotel Industry

Greece’s hoteliers are up in arms over a new indirect tax that is part of the structural reforms required as part of the country’s debt deal with its lenders.

Following the promise made by Prime Minister Alexis Tsipras that the so-called “occupancy tax” will take effect in 2018, the country’s tourism professionals were informed that a new bill (that includes indirect levies amounting to 1.8 billion euros through 2018) tabled in Parliament on Wednesday contains clauses on the adjustment of the Single Property Tax (ENFIA) rates to the new objective values of properties.

Hoteliers understand that, according to the bill’s Article 50, they now lose their initial ENFIA tax exemption and will be charged with an additional tax of a 0.1 percent rate on their properties.

In separate statements on Thursday, the Greek Tourism Confederation (SETE), the Hellenic Chamber of Hotels and the Hellenic Federation of Hoteliers, warned that Greek businesses will inevitably shut their doors and a significant loss of jobs will be recorded, taking an eventual toll on tourism.

Referring among others to the so-called “occupancy tax” to take effect in 2018 and the hike in value-added tax (VAT) from 23 percent to 24 percent, SETE underlined that the next two years are projected to be “extremely difficult” for Greece’s tourism enterprises.

“These (levies) are added to a range of other taxes on products and services that directly and indirectly affect the tourist, raising the cost of the travel package and diminishing the competitiveness of tourism”, the confederation said.

On its part, the Hellenic Federation of Hoteliers described the measures as “unreasonable” and said they aim to eradicate thousands of hotel enterprises across the country.

The Hellenic Chamber of Hotels sent a letter to the Minister of Finance Euclid Tsakalotos and stressed that the extra tax “is unfair and wrong” and will have devastating consequences on the viability of hotel businesses but also on the economy and jobs. The chamber called for the minister’s personal intervention for the additional ENFIA tax to be scrapped.