Gov't withdraws tax on hotel stays

Greece's Ministry of Finance has apparently withdrawn plans of taxing overnight stays at hotels, because it conflicts with constitutional provisions. Some may recall that the plan was to introduce a 3, 4 and 5 percent overnight stays tax for 3-, 4- and 5-star hotels, respectively. The bill, that also includes measures aimed at curbing the illicit trade in tobacco, alcohol and fuel, would be discussed in detail at the Ministerial Council meeting on Thursday.

On the other hand, a 10 percent tax is going to be imposed on all vehicles with an engine larger than 1.9 liters.

Presently there is a 5 percent tax on automobiles with 1.9 to 2.5 liter engines, while larger vehicles are now set to be taxed with a 10 percent rate. The luxury tax is not going to apply to vehicles over ten years old.

With the new tax, the government aims to generate more than 20 million euros, however there were thoughts of raising the existing 5 and 10 percent rates to 6.5 and 13 percent, respectively.