VAT Rate in Greece to Rise on June 1, Second Group of Islands to Lose Reduced Rate

As of June 1, the top value-added tax (VAT) rate in Greece will rise by one percentage point, from 23 percent to 24 percent, as agreed between the government and the country’s international creditors. As a result, thousands of goods and services are expected to suffer hikes in prices.

The VAT hike is included on a list of measures in an omnibus bill that recently passed in parliament and includes indirect tax hikes of some 1.8 billion euros.

June 1 also marks the day that a second group of Greek islands will lose a special value-added tax status — a 30 percent reduced implementation of all VAT rates — and revert to the nationwide rates of 6, 13 and 24 percent.

Sifnos Island. Photo © Maria Theofanopoulou

The islands of Syros, Thassos, Andros, Tinos, Karpathos, Milos, Skyros, Alonissos, Kea, Antiparos and Sifnos will lose the special 30 percent discount on VAT rates.

It is reminded that the islands of Santorini, Mykonos, Naxos, Paros, Rhodes and Skiathos lost the special value-added tax status as of October 1, 2015.

The abolition of the special value-added tax status on the Greek islands is in accordance to the third bailout package signed between the government and the country’s international creditors last year.