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Greece raises VAT rate to 24% 1st June 2016

  • Apr 5, 2016 | Richard Asquith

Greece raises VAT rate to 24% 1st June 2016

Greece will raise its VAT rate from 23% to 24% on 1 June 2016.

UPDATE: this was approved by the Greek Parliament on 22 May 2016 [Public Revenue Authority Circular POL 1061].

The rise will generate between €400m and €500m, and help meet a gap in the 2017-18 budget forecast. It will also help avoid a potential VAT rise in domestic electricity, water and private education.  There are no changes to the current 13% and 6% reduced and super-reduced rates, respectively.

The 30% reduction in VAT rate for many holiday islands is to be withdrawn, too.  This will affect: Syros, Thasos, Andros, Tinos, Karpathos, Milos, Skyros, Alonnisos, Kea, Antiparos and Sifnos.  This leaves a further group of island still on the 30% reduction of the standard, reduced and super-reduced rates.

The rise has been proposed to Greece quartet of institutional creditors, including: the European Central Bank; European Commission (representing EU member states); European Stability Mechanism; and the International Monetary Fund.

Greece originally raised its standard VAT rate twice in 2010, from 19% to the current 23%.  It also had to push through three other reduced VAT rises recently - so making June's VAT rise the sixth increase.

VP Global Indirect Tax
Richard Asquith
VP Global Indirect Tax Richard Asquith
Richard Asquith is VP Global Indirect Tax at Avalara, helping businesses understand their compliance obligations as they grow globally. He is part of the European leadership team which won International Tax Review's 2020 Tax Technology Firm of the Year. Richard trained as an accountant with KPMG in the UK, and went on to work in Hungary, Russia and France with EY.