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New Extension of Lower VAT for Five Greek Islands Announced

Five Aegean islands – Leros, Lesvos, Kos, Samos and Chios – have received a six-month extension to their special value-added tax (VAT) status, according to a recent decision of the Greek Finance Ministry.

The special value-added tax status, which sees a 30 percent discount on VAT rates, will be extended for the five islands until June 30, 2020.

The five islands are those located in the northeastern Aegean that have received the main burden of refugee flows.

The ministry’s decision refers to the “extremely urgent need to address the consequences of increased refugee flows on the islands of Leros, Lesvos, Kos, Samos and Chios”.

It is reminded that the abolition of reduced VAT rates for 27 Northeast Aegean and Dodecanese islands originally took effect on January 1, 2018. The five islands had been exempt from the higher VAT rates originally until June 30, 2018 and then until December 31, 2018. A further extension was then given until June 30, 2019, and another until December 31, 2019.

All the islands, with the exception of the five, have been required starting January 1, 2018, to implement new VAT rates from the 5 percent, 9 percent and 17 percent to 6 percent, 13 percent and 24 percent, respectively on basic food items, medication, hotel stays, books and magazines.

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