Its abolition Postage Stamp Fee for over 600 transactions and its replacement by the Digital Transaction Fee for all transactions that will continue to exist, the legislative initiative of the Ministry of National Economy and Finance provides. This reform concerns the modernization and simplification of a legislative framework that has largely been in effect since 1931, its complete digitization and its abolition – where necessary -, while it is a commitment of the country and a milestone in the Recovery and Resilience Plan. Chronic issues of ambiguity are also addressed.

In more detail, the draft law, which is expected to be immediately submitted to public consultation, promotes seven changes:

  1. the Stamp Fee is abolished and replaced with the Digital Transaction Fee,
  2. more than 600 cases of imposition of the Stamp Duty are definitively abolished,
  3. The transactions on which the Digital Transaction Fee will be imposed are explicitly mentioned, the declaration, calculation, certification and collection of which will be done entirely digitally through a special platform of AADE,
  4. its imposition on transactions falling within the scope of application of other indirect taxes is expressly excluded,
  5. it is defined that the Fee is imposed on transactions, where at least one transaction is a tax resident of Greece or has a permanent establishment in Greece, regardless of the type and location of the transaction,
  6. it is clarified who is liable to pay the tax,
  7. a single time of payment of the Fee is determined.

The Minister of National Economy and Finance Kostis Hatzidakisstated: “With the proposed draft law, we are attempting another reform of citizens’ everyday life and also of modernizing the operation of the Public Administration. We are leaving in the past, where it belongs, the outdated current framework for the Stamp Duty that dates back to 1931. And we are harnessing new technologies to address decades-old pathologies that have caused confusion for citizens and ambiguity in the application of tax laws. We are continuing the effort for the overall modernization of our tax system while, at the same time, abolishing the obligation to pay this Fee for over 600 transactions that positively affect the pockets of citizens and businesses.”

The Deputy Minister of National Economy and Finances Christos Dimas noted: “It is a measure aimed at freeing citizens, professionals, businesses and the State from bureaucratic procedures that burdened them until today. The purpose of the regulation is to modernize the legislative framework for imposing tax on transactions, to simplify and digitize the process, to rationalize the basis for imposing tax on transactions, as well as to reduce administrative burdens.

The Governor of the Independent Inland Revenue Authority George Pitsilis said: “Replacing the antiquated 19th century Stamp Duty with a modern Transaction Fee, which applies to specific transactions, known in advance to taxpayers, and is delivered digitally, is doubly beneficial for taxpayers. citizens and businesses. It offers legal certainty, eliminating reasons that caused friction with the Tax Administration and appeals to the courts, and at the same time saves taxpayers from inconvenience, as it is paid simply and quickly, with a digital process. The new Transaction Fee is a very important step in modernizing our tax system.”

The problems of the current framework

The current framework for Stamp Duty is to a significant extent complex and often creates application difficulties for traders. Some of the problems of the current framework are the following:

The Stamp Duty is imposed on contracts drawn up in Greece, with the result that its payment can be avoided by traders who simply draw up the corresponding contract abroad.
Also, the current framework does not explicitly mention the types of contracts on which it is imposed, but generally covers those contracts that are not subject to other forms of indirect taxation, with the result that there is no legal certainty in relation to whether or not a contract is subject to Stamp Duty.
The legal uncertainty is also exacerbated by the ambiguity regarding who is liable for the payment of the Stamp Duty and how the declaration and payment is made.

What changes with the new framework?

From now on, the new Digital Transaction Fee will be imposed on transactions, regardless of the place of their completion, as long as at least one contracting party has a tax residence or permanent establishment in Greece and there is no reason for exemption for the contracting parties. These transactions

a) are expressly named in the law,

b) are not subject to other indirect taxes.

Abolition of Stamp Duty

It is noted that with the proposed provisions, the Stamp Duty is abolished in more than 600 cases of transactions:

In more detail, the Stamp Duty is abolished in a number of important transactions such as: utility loan, insurance transactions, formation and capital increase of non-profit legal persons/entities, guaranteed bank credits in favor of importers, contractual interest on loans and credits.
Additionally, it is abolished in more than 100 transactions involving stamps on receipts (eg marriage license, professional licenses, etc.). Important note: The abolition of the Stamp Duty does not entail the abolition of the tax for the transactions in question. However, it leads to a reduction in the final burden.
It is also abolished in more than 500 transactions in which a Stamp Fee of 2.4% or 3.6% was imposed on reservations concerning NPDD or the State (e.g. Stamp on Reservations in favor of the National Medicines Organization (EOF), in favor of TACHDIK ( Court Building Financing Fund), in favor of EADISY (Independent Public Procurement Authority) Ms.

Declaration and performance of Digital Transaction Fee

The Transaction Fee for transactions between private individuals will be verified with an electronic declaration through a new digital platform that will be put into operation by AADE. The declaration and return of the Fee is made by the end of the following month from that of the transaction.

Excluded are the cases where there is an obligation to withhold income tax (its certification and payment is based on the withholding tax deadlines), rents (its payment is made through the submission of the Income Tax Declaration) and the case of a current account (the declaration and the return is made within the first month of the following tax year).

For transactions with the State, the Transaction Fee is paid electronically before the relevant act is drawn up or issued.

Digital Transaction Fee Factors

It is noted that the coefficients of the Digital Transaction Fee for transactions between individuals are clarified and defined as follows:

  • 3.60% on all real estate rents, on invoices for the collection of legal interest compensation and late payment interest and on transactions or contracts between natural persons who do not carry out a business activity and persons who carry out a business activity and are contracted for acts not related to it as well as in the cases where one contracting party is the State, Municipality, NPDD.
  • 2.40% if all the contracting parties or transactors carry out business activity, or at least one has the legal form of SA, EPE and IKE.
  • 1.20% if it is for payment of fees to natural persons or members of management and for deposits or withdrawals from the funds of legal persons and entities.
  • 0.30% on checks presented (“plates”) to credit institutions.

Digital Transaction Fee for loans, deposits and withdrawals

Loans subject to a Transaction Fee (loans between individuals/companies which are not banks) are subject to a maximum Transaction Fee of 150,000 euros per loan contract, regardless of where the loan was taken out. In this way, the reasons for circumventing the legislation will no longer exist. Thus, the government will collect the fees that until now it lost as the relevant contracts were concluded abroad. The burden on companies and individuals will be at reasonable levels.

In more detail, they are subject to a Transaction Fee:

  • with a rate of 3.6% for loans between individuals,
  • with a rate of 2.4% for loans between natural or legal persons who both carry out business activity or where at least one contracting party is a SA, EPE or IKE,
  • with a rate of 1.2% the entries in the books of legal entities regarding deposits and withdrawals.
  • with a rate of 2.4% the bond loans of Law 4548/2018 unless they are traded on a regulated market or multilateral trading mechanism.

It is noted that contractual interest on loans is excluded from the Fee.