The draft bill on the imposition of value-added tax (VAT) on new buildings is one of the most important innovations attempted recently in Greece, and this element largely explains its delay. In the last few decades, finance ministers had postponed the application of VAT on real estate simply because it would change many things considered as given. It does away with the system of concession of old property in exchange for apartments, on which the very housing reconstruction of the country was largely based and integrates a significant sector of productive activity into the «mainstream» economy. The exemption of buildings from VAT and their sale at prices different from the so-called «objective» prices, officially set by tax authorities according to area, has meant that a substantial section of the industry was part of the underground economy. The bulk of house construction companies were family businesses where the revenues of the company and of the owner are the same. The owner earns «unofficial» revenues, pays where possible without an invoice and is taxed according to estimates. That explains the reactions in the sector, where professionals know that since they pay VAT they will join the official economy, with all that this entails. Construction activity will now be conducted by «normal» companies, small and large, and their cash books will be different from those of their owners. Nevertheless, the imposition of a capital gains tax on subsequent sales of housing property is another matter which may require closer study. For a start, the very name given to the tax by the government shows excessive optimism, as if real estate prices can only go up. We may have got used to this notion, but it is not realistic to think that some prices, even of properties, move only upward. Indeed, there should be a provision for cases in which they move the other way. If property prices drop and someone sells at a price that is lower than the one he had originally paid, he should have the difference – the loss he suffered – exempt from taxation. This is how the capital gains tax functions where it is applied. Whoever earns pays taxes, while losses are exempt from tax. Theoretically such a tax could apply to share transactions too, as in the US, where profits from share sales are taxed, but losses are exempt. It is not fair for the government to nationalize part of taxpayers’ profits and fully privatize their losses.