ECONOMY

Tax rate cut in catering sector has paid off

The reduction in the value-added tax on catering has not only resulted in smaller-than-expected revenue losses for the state coffers, it has also stemmed the flow of restaurant shutdowns and is expected to create thousands of new jobs in the sector.

Data collected by the association of restaurant owners (SEPOA) from the General Accounting Office for the August 2013 to June 2014 period showed the loss in VAT revenues from the reduction of the rate on catering services from 23 to 13 percent in August 2013 was two-thirds smaller than anticipated, reaching some 9 million euros per month.

Before the VAT rate change, some 4,500 more restaurants had shut than those that opened, while that figure has now gone down to zero.

After the loss of 30,000 jobs in the sector during the crisis, SEPOA anticipates 10,000 jobs to be created in 2015.