Taxation in Greece

Income taxation in Greece is progressive. Income tax is payable by all individuals earning income in Greece, regardless of citizenship or place of permanent residence. Permanent residents are taxed on their worldwide income in Greece.[2] An individual in Greece is liable for tax on their income as an employee and on income as a self-employed person. In the case of an individual who is a permanent resident of Greece, their tax owed is calculated on their income earned in Greece and overseas. An individual whose income is only from a wage is not obligated to file an annual return. The employer deducts tax from the employee and transfers it to the tax authority every month.[3][4]

The 2014 tax rates are as follows:[5]

On May 9, 2016 a new set of emergency measures were voted in the Parliament by the SYRIZA/ANEL government.[6] These changes include new income tax rates as well as new solidarity tax rates. The tax rates applicable to income earned in 2016 are as follows:[7]

The solidarity tax rates are progressive ranging from 2.2% to 10%. They are assigned as follows:[8]

But as 01 January 2020 the tax rate for the solidarity contribution will have been amended as in the table below:[9]

Corporations in Greece are taxed on their income in Greece and from overseas. Foreign companies in Greece are taxed only on income that is generated in Greece. Also, there is 100% advance payment of the taxable amount of the current fiscal year, and is being balanced by each next fiscal year financial data.

Corporate income tax rates by year:

• 2007, 2008, 2009 - 25%
• 2010 - 24%
• 2011, 2012 - 20%
• 2013, 2014 - 26%
• 2015 - 29%
• 2019 - 28%

The corporate income tax rate is to be gradually reduced as follows:[10]

• Late 2019 - 24%
• 2020 - 20%

The planned reduction does not include corporate income tax rate of Greek credit institutions and Greek branches of nonresident credit institutions, which is to remain at 29%.

A capital gain in Greece is added to regular income and is taxable at the same rate as regular income for a company, other than in specific instances as defined in law.

A capital gain by an individual in Greece is taxable at the rate of 15%. There is no tax in the case of capital gain from trading in the stock market as long as the individual owns less than 0.5% of the publicly listed company.[11]

As of 1 Jan 2009, Greece imposes a withholding tax of 10% on corporate dividends, unless the dividend qualifies for application of the EC Parent-Subsidiary Directive or if a lower rate applies under an applicable double tax treaty.[12] It also imposes a withholding tax on interest and royalties, however the tax rates may be reduced or eliminated by an applicable double tax treaty or if the payment qualifies for application of the EC Interest and Royalties Directive.[13][14]

As of 13 December 2018 the withholding tax rates are as given in the table below:[15]

Value added tax (VAT) was implemented in to the Greek taxation system in 1987 in order to replace turnover tax and other indirect taxes. The Greek VAT system complies with the European Union value added tax system.

The Value added tax (Φόρος Προστιθέμενης Αξίας) in Greece consists of 3 rates:

• standard rate of 24%
• reduced rate of 13%
• super reduced rate of 6%

The VAT rates applied in the Aegan islands of Leros, Lesbos, Kos, Samos and Chios, are 30% lower than the corresponding rates applied in the mainland. The lower VAT rates applied in these Greek Islands are 4% (super-reduced rate), 9% (reduced rate) and 17% (standard rate). The lower VAT rates are in effect until 30.06.2019.[16]

The standard rate applies to the following categories and to the following goods and services:

• foodstuffs, water supplies, pharmaceutical products, medical equipment for disabled persons, children's car seats, books, newspapers, periodicals, admission to amusement parks, admission to cultural services (except theatre and concert tickets), admission to sporting events, cable TV, writers, composers etc., social housing, renovation and repairing of private dwellings, window cleaning and cleaning in private households, agricultural inputs, restaurant and catering services, use of sporting facilities, supplies by undertakers and cremation services, medical and dental care, bicycles, shoes and leather goods, clothing and household linen.

• alcohol beverages, lemonades and fruit juices, clothing, footwear, tobacco, hifi-video, computers, smartphones, E-books, household electrical appliances, furniture, jewels, telecommunication services, energy products (firewood and timber for industrial use), petroleum products ( unleaded petrol, diesel fuel, LPG, heating oil, lubricants), motor vehicles, domestic passenger transport (air, sea, inland waterway, rail and road), international passenger transport (inland waterway, rail, road), bars and cafes, immovable property, treatment of waste and waste water, services supplied by lawyers, art, collector's items and antiques.[17]

The reduced rate applies to the following categories and to the following goods and services:

• foodstuffs, water supplies, pharmaceutical products, medical equipment for disabled persons, agricultural inputs, hotel accommodation, social services, domestic care services.

• mineral water, energy products (natural gas, electricity, district heating), hotels[18]

The super reduced rate applies to the following categories:

• pharmaceutical products,
• newspapers,
• admissions to cultural services (theatre and concert tickets).[19]

VAT returns are submitted on quarterly or monthly basis, depending on the type of books (single or double-entry books) kept byt the VAT payer. Exempted from VAT are those taxable persons whose annual turnover (excluding VAT) is no higher than €10,000 from supply of goods or/and services. Such persons may opt to be exempt from VAT. The exemption does not apply with regard to taxable persons not established in the Greek territory.[20]

There are several cases of Tax exemptions under the Greek taxation system, these are as follows:

• Proceeds from the sale of shares that are traded on the Athens Stock Exchange.
• Income from ships and shipping.
• A dividend received from a Greek company.
• Capital gain from sale of a business between family members, as defined by law.

The examples of Tax deductibility in Greece are, as with most other features of Greek taxation, similar to that of other Western European and North American nations, that is, tax deductibility for things such as charity and other things as shown below:

• 15% credit on a mortgage for the first residential apartment.
• 15% rent paid on the main residential apartment up to maximum.
• Donations to public, religious and other institutions.
• Compulsory payments to social security.

• Social security tax is paid 12 times a year.
• VAT tax is paid 3 times a year.
• Income tax is paid once a year.

• Tax evasion and corruption in Greece