The government is planning to implement a single value-added tax rate abolishing all existing exemptions, according to a Kathimerini news daily report quoting officials in Brussels. Sources from the seat of the European Commission speak of a flat 18% VAT rate for all services and commodities with the exception of medicines, to come into force by the second half of the year.
For now Athens categorically refutes such a scenario, noting that negotiations are still ongoing. If the government and its creditors reach an agreement on the application of a flat VAT rate, the result for the state coffers could theoretically be positive, but there will be an extra burden on Greek households as all basic goods will become more expensive, except for medicines.
There will be a reduction of 5 percentage points in the 23% VAT rate imposed on many products and services, but also a 5 percentage-point hike for key commodities such as food, electricity, catering etc. The special status granted to Aegean islands, with a 30% discount on VAT rates, will be abolished.
This was originally introduced to offset the high cost of transporting commodities to the Greek islands. In practice, a VAT adjustment will not necessarily lead to a rise in public revenues. Experts -and common sense- say that such a development could actually lead to an increase in tax evasion.
Source: Kathimerini
Οι πιο πρόσφατες Ειδήσεις
Διαβάστε πρώτοι τις Ειδήσεις για ό,τι συμβαίνει τώρα στην Ελλάδα και τον Κόσμο στο thetoc.gr
