ECONOMY

Possible cut in VAT rates and in transfer tax

The government is considering a reduction of value-added tax rates on various goods and the property transfer tax, according to Finance Minister Yannis Stournaras, provided that the execution of the budget remains in positive territory.

Addressing an event organized by the Federation of Industries of Northern Greece late on Friday, the minister stressed that there is plenty of work ahead for Greece and that any lightening of the tax burden would necessarily require the approval of the country’s creditors.

“I need to stress that for this coalition government stability does not mean stagnation. The first positive indications that we are containing the recession and the growth of unemployment will not make us complacent. The government is trying to accelerate the return to growth,” Stournaras said. He added that “we are investigating the possibility and the conditions under which we could reduce the VAT in certain categories of commodities and the [tax] rates in property transfers, so as to boost the key sector of construction, which has a huge added value for the economy.”

Nevertheless, the most recent European Commission report on Greece said that there should be no great expectations for tax reductions and that the VAT rate on food service would be discussed again in June.