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  • Government withdraws ‘unconstitutional’ tax on hotel stays

    The Ministry of Finances has decided to withdraw its plans of taxing overnight stays at hotels, as it appears that it conflicts…

    The Ministry of Finances has decided to withdraw its plans of taxing overnight stays at hotels, as it appears that it conflicts with constitutional provisions. According to the draft plans, the government was to introduce a 3%, 4% and 5% overnight stay tax for 3-star, 4-star and 5-star hotels respectively.

    On the other hand, it was decided to impose a 10% tax on all vehicles with an engine larger than 1.9 liters. At present there is a 5% tax on cars with 1.9 to 2.5 liter engines, while larger vehicles will be taxed with a 10% rate, while the luxury tax does not apply to vehicles over ten years old.

    With this tax on vehicles the government aims to generate about 20 million euros, however there were thoughts of raising the existing 5% and 10% rates to 6.5% and 13% respectively.

    The bill, which also includes measures aimed at curbing the illicit trade in tobacco, alcohol and fuel, will be discussed in detail at the Ministerial Council meeting that has been scheduled for Thursday.

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