At the high rate VAT 24% resumes from today, Monday July 1st coffee served and non-alcoholic beverages (cocoa, tea, juices, etc.).

The tax on these drinks is fixed at 13% only when it comes to hand delivery (take away and delivery).

Indicative prices in cafes

The return of coffee to the high VAT rate (24%), combined with the large price hikes in the raw material, is expected to bring increases of up to 15% in the coffee served in cafes and coffee shops.

Under these circumstances, it is now up to each business individually to decide whether to “pass on” the return of VAT to 24% to the retail price (resulting in an additional increase of 0.11%) or absorb it.

According to estimates with the new 15% increase in the price of coffee:

– The freddo espresso in the cafeteria it will be sold at 4 m 4.10 euros from 3.5 euros,

– its price Freddo cappuccino will rise to 4.50 – 4.60 euros from 4 euros today and

– The Greek coffee which until yesterday cost 2.5 euros from today will be sold at least 2.80 euro.

The representatives of the catering industry point out the risk of limiting consumption with what this entails for businesses, and ask the government not to apply the two different “speeds” in the VAT for coffee.

The international price of coffee has been on an upward “rally” in recent months. The figures show that prices in the Robusta coffee variety market have reached their highest levels in the last 45 years and from January 2024 to May they have increased by 50%, driving up the price of Arabica coffee.

The AADE circular

In view of the implementation of the new regime with the VAT on coffee, AADE issued a circular providing clarifications in order to avoid new disruption in the market.

Particularly:

“From July 1, 2024, the standard VAT rate of 24% is applied to the on-site consumption (served) of all types of coffee, cocoa, tea, chamomile and other beverages and therefore, the standard VAT rate of 24% is applied to all alcoholic and non-alcoholic juice drinks and beverages available for on-site consumption.

After July 1, 2024, the reduced VAT rate of 13% will continue to be applied to the delivery of non-alcoholic beverages, juices and beverages in a “package” (take away and delivery), including coffee, cocoa, tea and chamomile and other beverages as they constitute deliveries goods as well as when the delivery of these by catering businesses to their customers is not part of an overall on-site provision of catering service”.

Taxi fares remain at the low rate of 13%.