FinMin: Permanent VAT reductios for five Eastern Aegean islands

“The government has sought and achieved in a permanent and coherent way the time extension of the reduced VAT rate on the islands of Leros, Lesvos, Kos, Samos, and Chios after negotiations with the Institutions and the final decision that took place last Thursday in the Eurogroup,” stressed Minister of Finance, Christos Staikouras, in the Plenary Session in supporting the relevant amendment that has been submitted for voting in the bill of the Ministry of Development and Investment.

The Minister of Finance stated that with the new agreement reached by the government with partners, the reduction of VAT in these five islands of the Eastern Aegean will not be given every six months as today, but mainly, it is disconnected from the average annual number of foreigners hosted. from third countries located on these islands.

Mr. Chr. Staikouras, explained that from 1/7/2021 in these five islands there will be a reduction of 30% of VAT rates if reception and hospitality structures of third country nationals operate in their region, and for as long as they remain in operation, without the semi-annual assessment and regardless of population criteria.

In the event that on one of the five islands these structures are closed, the provision and the agreement with the partners stipulate that the reduction is automatically revoked within three months from the closure of their structures.

The Minister of Finance pointed out that “the dependence of the continuation of the reduced VAT on the number of guests on these five islands is eliminated. A volatile condition is removed and the foundations are laid for economic development and mitigation of the effects on the lives of local communities in the islands of the eastern Aegean that have been disproportionately affected by the migration crisis and the increased flows in previous years.”