06.20
5% REDUCED VAT RATE APPLICABLE ON TOURISM SERVICES
VAT DECREE Κ.Δ.Π 268/2020 WAS ISSUED BY THE CABINET ON THE 23RD OF JUNE 2020 TO TEMPORARILY REDUCE THE VAT RATE ON TOURISM SERVICES

Tax Updates

VAT Decree Κ.Δ.Π 268/2020 was issued by the cabinet on the 23rd of June 2020 to temporarily reduce the VAT rate on tourism services.

The reduction of the VAT rate from 9% to 5% will be applicable for the period from the 1st of July, 2020 to the 10th of January, 2021, for:

  1. hotel accommodation, hotel apartments accommodation and similar establishments, including holiday accommodation;
  2. restaurant and catering services;
  3. transport of passengers and their accompanied luggage.

As it is clarified, restaurant services consist of the supply, rendered in the premises of the supplier, of prepared or unprepared food and/or beverages for human consumption, accompanied by a sufficient support service allowing for the immediate consumption thereof, while catering services consist of the same supply, rendered off the premises of the supplier.

It is further clarified that catering is characterised by a cluster of features and acts in which services largely predominate, and of which the provision of food and/or beverages is only one component.  

Therefore, the supply of prepared or non-prepared food or beverages or both, with or without transportation, not accompanied by other support services, is not considered restaurant and catering service.

Finally, the reduced VAT rate of 5% will be applicable for the transport of passengers and their accompanied luggage within the Republic, by urban, intercity and rural taxis, as well as, by tourist and intercity buses.

 

Contact Person:

Demetra Constantinou
Partner – VAT Department
Demetra.Constantinou@kinanis.com
VAT@kinanis.com