ECONOMY

Online payments would boost revenues from islands better than VAT hikes

online-payments-would-boost-revenues-from-islands-better-than-vat-hikes

The projected fiscal benefit from the value-added tax hike on popular holiday islands, such as Paros (pictured), is small compared to the problems it will generate, according to Parliament’s State Budget Office.

Its economists argue that the estimated maximum additional revenues from the VAT increase will not exceed 160 million euros, compared with the 250 million the Finance Ministry expects.

They note that revenues could be boosted by combating tax evasion through the universal application of the electronic payment system that would allow the state to cash in an extra 2 billion euros from VAT.