Greek PM’s Decision to Tax Airbnb Activity Gets Mixed Reactions

Greek Prime Minister Kyriakos Mitsotakis’ announcement over the weekend to tax Airbnb rental income and increase a so-called “stayover tax” paid by hotel customers received mixed reactions from hospitality stakeholders and property owners.

Among others, during his state of the nation address in Thessaloniki, Mitsotakis said short-term rental income would be taxed as of January applicable to operators of three or more properties, and that the stayover tax will also increase from the current  0.5 cents-4 euros range to 1-6 euros. The measure is aimed at collecting revenues that will fund a special reserve created to address needs caused by natural disasters.

Retsos: Airbnb measure is positive, Stayover tax increase is problematic

SETE’s former president, Yiannis Retsos.

Commenting on the news, former Greek Tourism Confederation (SETE) president and hotel owner, Yiannis Retsos, said the increase in stayover tax was “problematic” and that foreign visitors should not be forced to cover local infrastructure needs. He described the decision to tax tourism enterprises in times of trouble as a “chronically applied easy solution”. At the same time, he added that it would also hinder competitiveness.

With regard to short-term rental measures, Retsos said they were very positive, in the direction of ensuring a level playing field in the hospitality sector. “SETE’s proposals are being adopted. Short-term rental activity is part of our tourism product and with proper regulation will be able to compete with rules with accommodation facilities,” he said.

Hoteliers and rooms to let operators also welcomed the decision to tax Airbnb-style incomes.

Vassilikos: Airbnb measure is a first positive step

Hellenic Chamber of Hotels President Alexandros Vassilikos.

On his part, Hellenic Chamber of Hotels President Alexandros Vassilikos said that the new regulation announced by the government on short-term rentals is a first positive step.

“This adopts the Hellenic Chamber of Hotels’ solid position on separating ordinary owners who share their property to boost their personal income, from all those who for so many years, recklessly and without rules, have been doing business,” he said.

Vassilikos added that the effects of the regulation on competition but also on the social problems created by the uncontrolled activity of short-term rentals remain to be assessed in the immediate future.

“As well as the effects on the competitiveness of the Greek tourist product from the announcement of the increase of the stayover tax,” the chamber’s president added.

Greek property owners: Airbnb measure is unfair

On its part, the Hellenic Property Federation (POMIDA) issued an angered statement claiming that property owners are once again faced with unfair measures and fixed taxation regardless of size. POMIDA members are calling on the government to make building insurance mandatory and for tax deductions. At the same time, the association goes on to underline that income generated from short-term rental activity enabled thousands of owners to renovate their properties, be consistent with their tax obligations and support the national economy with income and foreign exchange.

The three-property limit and incomes to be taxed is “very small and suffocating” and will lead due to the operational costs involved to the exit of thousands of small owners from the market leading to losses for both state and property owners and create space for a shadow economy.

It should be noted that as of 2025, a new European Commission VAT regulation is expected to increase short-term rental prices by as much as 20 percent.

PM: We’re not trying to ‘do away’ with the Airbnb market

Greek PM Kyriakos Mitsotakis speaking during the press conference held at the 87th Thessaloniki International Fair.

When asked during a press conference in Thessaloniki about short-term rental taxation, Mitsotakis said it was a first set of announcements aimed at leveling the playing field and ensuring “greater balance so that we do not have the pressure that we have in certain areas”.

He went on to add that local governments will be involved in ensuring rules are implemented and that the aim is not to “do away with a very important market”.

On average, short-term rental activity in Greece generates 3.3 billion euros annually but at the same time is causing the state to lose millions in tax revenue.

Meanwhile, Greece’s Independent Authority for Public Revenue (AADE) is expected to enter updated memoranda of understanding (MoU) with short-term rental operators Airbnb, Booking.com and VRBO on the sidelines of the 87th Thessaloniki International Fair (TIF).