Hoteliers seek VAT solutions

The Association of Hellenic Tourism Enterprises (SETE) is trying to help Greek hoteliers overcome the impasse they have come to with foreign tour operators regarding the signing of contracts for 2016 due to an inability to calculate prices as the new value-added tax rates to be imposed on Greek tourism packages have yet to be decided.

The president of SETE on Thursday secured the approval of the association’s general meeting to send a recommendation to all members for a coordinated demand from foreign clients for a price adjustment clause in the new contracts. The aim of this move is to avoid missing out on the first bookings for 2016 that have already started in the UK.

The clause will allow for the absorption by hoteliers of the difference from the change of the VAT rate from bookings to enter the hotels’ systems by the time the new rates start applying. There will also be a provision saying in the case that after the signing of the contract a legislative act is passed increasing the VAT rate being applied, this increase would burden the agreed prices that will be adjusted to the relevant percentage rate.

For this season SETE chief Andreas Andreadis commented that “prolonged negotiations between the government and the creditors have started to leave a negative imprint on tourism but there is still time to reverse the climate, although the possibilities for the target of 25 million foreign arrivals to be attained are diminishing.”

He went on to warn that if the VAT hike takes the levy above the level of the country’s direct competitors, “we will immediately see millions of tourists choosing countries with a more competitive product, tens of thousands of jobs will be lost and enterprises will have to shut down.”

Meanwhile, online searches made from February 1 to May 11 for trips in July and August in Greece show that the most popular destinations are Myconos and Santorini, according to Trivago. On Myconos the average hotel rate for one night’s stay in a double room is 262 euros, while on Santorini it stands at 218 euros.

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