Prime Minister, Alexis Tsipras, announced on Friday afternoon the suspension of hikes on Value Added Tax on the five islands hit by the refugee crisis. Stressing that he discussed the issue with European Commission President, Jean-Claude Juncker during his recent visit to Athens, Tsipras said that he received the green light for the measure during the EU Summit. A truly last minute decision as the hikes were to be implemented as of 1. July.
“This is the least we can show in solidarity with the residents of these five islands,” Tsipras said during a press conference in Brussels.
The Greek prime minister said further that he has instructed the government to issue a special degree to make the suspension a law. He underlined that the five islands will be exempted from the VAT hikes for as long as the refugee crisis continues and for as long as he is prime minister.
The islands where the VAT hikes will not be implemented are: Lesvos, Chios, Samos, Kos and Leros.
The hikes on Value Added Tax were to be implemented as of 1. July 2018, in the context of implementation of the third bailout program.
UPDATE June30: The special government says that the VAT hikes on the 5 islands are suspended until 31.12. 2018.
The Greek islands had been always enjoying V.A.T. lower at 30% due to their remote position. In all other islands the V.A.T. increased to 24% as in the mainland in the last two years due to the 3. bailout program. The five islands were the last on the implementation list.
Of course, neither Juncker, nor the boss of the eurozone and ultimately also the European Union, the European Commission and the European Council, Angela Merkel, would give something without getting something else in return. So suspicion is close that Greece stroke a “fair trade” deal….
After a bilateral meeting with Tsipras Friday morning in Brussels, Merkel officially announced the deal media had been reporting about in the last days. That Greece – and Spain – will take back refugees from Germany. The details of the bilateral deals are expected to be ready next week and the agreement will be implemented as soon as signed and sealed.
According to some Greek media, Merkel would allow refugees from Greece to move to Germany in the context of family re-unifications.
I have no idea what Spain has received in return for doing a favor to Berlin.
I would urge anyone with the interest of Greece at heart to read ‘Adults in the Room’ by the ex-Finance Minister, Yanis Varoufakis. It is quite clear from his experiences dealing with Europe that you cannot trust a word the cabal within the European Union say. This cabal is bent only on retaining power; it has no respect for democratic institutions or their representatives, and uses the media as tools to promote its centralising agenda. There is no doubt in my mind that Alexis Tsipras had been given some form of encouragement over his plan not to raise VAT on the islands, only to find out later that the “mistake” had been his own.