The European Commission signaled the Greek government is free temporarily to reduce value-added tax in restaurants, saying the step wouldn’t undermine public finances.
“A reduction in the VAT rate for the restaurant sector would be possible without running any budgetary risks, so long as it was just a temporary measure,” Simon O’Connor, a spokesman at the commission, the 28-nation European Union’s executive arm, told reporters in Brussels on Wednesday. “We’ve been working on this for the last few days.”
The government of Prime Minister Antonis Samaras wants to lower the VAT rate in restaurants to 13 percent from 23 percent while remaining eligible for emergency aid granted by the euro area and the International Monetary Fund in return for narrowing the country’s budget deficit.
“As far as I know, it’s the government’s intention to start reducing the VAT rate as from August until the end of the year,” O’Connor said.