Greek Gov’t Mulls Tax Relief for Covid-hit Businesses

Andrianou Street in Plaka, Athens. Photo © Maria Theofanopoulou

Greek business owners impacted by the Covid-19 health crisis will have more time until the end of the year to pay off their tax obligations, said Alternate Finance Minister Theodoros Skylakakis.

Referring to seasonal enterprises – those mostly active in tourism –  Skylakakis told ANT1 TV that additional time may be given, possibly until April 2021, for the deferment of tax payments.

Earlier this week, representing hundreds of shop owners in the Greek capital, the Athens Traders Association (ESA) called on the government to implement support measures aimed at keeping businesses above water in the aftermath of the Covid-19 health crisis.

Stavros Kafounis, the president of the association, informed Slylakakis of the repercussions on business owners of the extra cost of measures taken to deal with the coronavirus outbreak. Among others, he called for a 40 percent reduction in rents, which he said poses the biggest problem to business viability.

He added that new measures were necessary to address the debts created during the health crisis and called for “the necessary deferment of payments until normalcy returns to the economy”.

Photo © Maria Theofanopoulou

Skylakakis said in his interview to ANT1 that the 40 percent reduction applicable to restaurants, tourism, cultural events and sports events operations, as well as to some transport companies, is likely to be extended into the next month. This however will not apply to all of the above categories.

With regard to rent, Skylakakis said retailers should negotiate individual agreements with property owners. The association of property owners has already proposed voluntary agreements instead of mandated rent cuts and that the state fund 30 percent of the rent reduction in the form of tax incentives.

In the meantime, Skylakakis said the government was formulating a plan for businesses to repay debts incurred during the pandemic after the grace period expires. According to the minister, the plan foresees the option of a 12-month, interest-free repayment schedule, or a 24-month plan with 2.5 percent interest.

The minister also said the government may extend unemployment benefits beyond the 12 month period as well as allow the further suspension of employment contracts to avoid dismissals.

He did however reject slashing VAT on certain products or commercial activities.

Meanwhile in related news, in June, the Athens Municipality  teamed up with the city’s traders union to support the revival of the Greek capital’s commercial center in the aftermath of Covid-19. Under the three-month “Athens is Back” initiative, businesses and cultural bodies in Athens’ seven districts promoted their discounts and products on the www.athensisback.gr platform aiming to motivate shoppers and stimulate the market through to September 16.