The possibility of Greece for the application of special, reduced by up to 30% VAT rates in the Aegean islands, is secured on a permanent basis by the proposal of a Directive that was unanimously adopted in Ecofin on Tuesday. At the same time, Greece supported and achieved a change in EU rules so that VAT on goods and services related to tackling climate change, health protection and the digital transition of the European Union could be reduced:
– Application of reduced rates on solar panels, baby diapers, surgical masks, live streaming services
– VAT exemption on basic necessities and services, as well as medical equipment and wheelchairs
Application of VAT exemption in cases of crises, disasters, pandemics.
The Proposal for a Directive on VAT rates in the EU was reached by unanimity, a Political Agreement of the Member States in the Ecofin Council of Finance Ministers.
The Agreement, which will be implemented in all Member States from 2025, is the result of compromise and successful negotiation at EU level over the last 2.5 years.
“Possibility that 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 definitive VAT regime “is emphasized.
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 and 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.
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 applicable 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.
“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 ensure national interests and restore tax rights. , which for decades had been secured by the country, as regards, in principle, the application of reduced VAT rates. “A choice that has proven to be correct and effective,” he comments.
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 Ecofin Council, raised the issue. in the 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.
At the same time, 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, which our country has strongly supported, proposing and contributing to the adoption of necessary for the smooth adjustment of the affected groups (farmers).
Greece, firmly reiterating its political reservation in support of small farmers, reached a unanimous agreement of all Member States to support the industry in all Member States, by enabling the application of reduced rates to cotton, agricultural machinery and other basic agricultural species, when financial conditions allow.
Summing up, according to YPOIK, 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.
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