Press release (Unofficial translation)
The Ministry of Finance announces that today, December 7, 2021, a Political Agreement of the member states was reached by unanimity in the Council of Finance Ministers E cofin , regarding the Proposal for a Directive on VAT rates in the EU.
The Agreement, which will be implemented in all Member States from 2025, is the result of compromise and successful negotiation at EU level. the last 2.5 years.
During the technical negotiations at the level of the EU Council, it was a political choice to represent our country at a high governmental level , in order to constantly express the political positions and choices of Greece to safeguard national interests and restore tax rights. which the country had secured for decades, as regards, in principle, the application of reduced VAT rates.
A choice that proved to be correct and effective, as the proposal for a Directive as adopted, secures on a permanent basis the possibility of Greece to apply special, reduced by up to 30% VAT rates in the Aegean islands.
Possibility which was eliminated from the Proposal of the European Commission in 2018, which treated the relevant special provision of the Directive for Greece (article 120 of Directive 2006/112 / EC for the Aegean islands) as transitional and to be abolished within the framework of the final VAT regime.
Specifically, the Ministry of Finance, through the Secretary General of Tax Policy and Public Property, Mrs. Athena Kalyva, who attended all the technical meetings at the level of the EU Council, and the Minister of Finance, Mr. Christos Staikouras, at the level of the E cofin Council , issue of maintaining special rates in Aegean islands, linking the Greek request with its final agreement on all the regulations of the proposal and highlighting peculiarities of Greek insularity, but also legal arguments in favor of the Greek position.
In any case, the Proposal for a Directive on VAT rates, as adopted, has a clear environmental connotation, as it is adapted to the European goals of the Green Deal ( Green Deal ), which our country has strongly supported, proposing and contributing to the adoption of complementary interventions for the smooth adaptation of the affected groups (farmers).
In particular, the Ministry of Finance has firmly focused on the need to support small farmers by reiterating the constant Greek request for the possibility of applying reduced VAT rates on agricultural machinery as well as cotton, as a condition of agreement on the proposal, and introducing a clause to ensure the applicability of reduced VAT on pesticides – fertilizers until after 2030. Greece, firmly reiterating its political reservation in order to support small farmers, reached a unanimous agreement of all Member States to support the industry in all Member States, with the possibility of applying reduced rates to cotton, agricultural machinery and other basic agricultural items, when financial conditions allow.
Furthermore, the Government’s goal was and is also to support the real estate market. In this context, the Ministry of Finance has consistently supported and achieved the extension of the application of reduced VAT rates to related goods and services, by enabling the use of derogations applied to the application of reduced VAT rates in other Member States, including the market. real estate.
In addition, the Ministry of Finance during the discussions submitted additional requests for the possibility of applying reduced rates to individual goods and services, so that, if accepted by the Member States, they can be used by our country, based on social needs. and budgetary constraints.
Indicatively, Greece supported and achieved enrichment of the List of reduced rates by providing an opportunity, indicatively:
- Apply reduced rates in solar panels, baby diapers, surgical masks, service live streaming spectacles
- VAT exemption on basic necessities and services, as well as medical equipment and wheelchairs
- Application of VAT exemption in cases of crises, disasters, pandemics.
In summary, the agreement on the proposal for a Directive on VAT rates is a real success for our country, as it includes special measures concerning critical sectors of the Greek economy and society, such as the green and digital transition, the strengthening of farmers and the real estate market. the support of the geographical peculiarities of the country, through the support of the Aegean islands, the strengthening of the social cohesion, through the special regulations for the confrontation of crises and catastrophes. At the same time, it ensures acquired Greek rights, while expanding the possibility of applying reduced rates in critical sectors within the European VAT system, while strengthening the competitiveness of the Greek tax system and the economy.
The Government and the Ministry of Finance reaffirm their persistence and commitment to the pre-election commitments to support society and the economy, with the clear aim of overall growth and progress, and through the modernization and progress of the European VAT system.
Source minfin.gr
