ECONOMY

Recovery signs bring VAT reduction in food services closer

The prospect of an agreement for the reduction of value-added tax on food services from 23 to 13 percent, possibly from next month, was greeted as a “particularly positive development” by the president of the Association of Hellenic Tourism Enterprises (SETE), Andreas Andreadis. If the reduction is implemented it will be seen as a sign of economic recovery, which was also underscored by the heads of the IMF and the Eurogroup.

“Returning VAT to the levels of our rivals from August 1 constitutes a genuine measure toward growth,” Andreadis said on Tuesday, adding that the aim is for that reduction to reach consumers. He went on to ask for a similar reduction in the whole tourism sector as well as in coastal shipping.

Early on Tuesday the managing director of the International Monetary Fund, Christine Lagarde, confirmed the positive impression Athens has made in its effort to streamline its economy, saying she is expecting Greece to show a primary surplus from as early as this year.

“When I look at Greece, I’m very impressed by the efforts that have been undertaken to restore the fiscal situation of the country. It may well be that by the end of 2013, Greece will be in primary surplus, which is an amazing achievement,” Lagarde told US TV station CNBC.

“A lot needs to be done, whether you’re talking about the tax reform, the tax authority’s reform, the continuation of the privatization program… the management of the public service – all of that is still on the table and work in progress that needs to be continued. But there have been clear achievements,” she added

Eurogroup head Jeroen Dijsselbloem spoke on Tuesday of an impressive recovery, but stressed that the Greek side needs to carry out more reforms.

He added that a Greek exit from the crisis will depend on the application of reforms, conceding that they are tough and demanding but necessary for the modernization of the economy.