Update to VAT rules based on 2025 Budget
The Greek Parliament approved the 2025 Budget, cementing a series of fiscal and regulatory measures aimed at addressing economic, environmental, and social challenges. The Budget, submitted earlier in the year, incorporates significant changes, including amendments to VAT rules and new tax policies to support fiscal resilience and equitable taxation.
Read more in our Greek VAT guide. The key measures include:
1. Extension of the VAT exemption for new buildings
The VAT exemption for newly constructed buildings is extended through 31 December 2025. Under Greek VAT law, new buildings typically attract VAT at 24%. However, to stimulate the real estate market and encourage development, this exemption was initially introduced and has now been prolonged. This applies to sales of properties with construction permits issued after 1 January 2006, provided they are used as primary residences. Developers and buyers must meet specific criteria, such as non-utilisation of VAT input credits, to benefit from the exemption.
2. Introduction of VAT on short-Term Rentals
Effective from 1 January 2024, legal entities and individuals renting more than two properties for short-term accommodation (e.g., via platforms like Airbnb) are subject to VAT at 24%. This move aligns with Greece’s efforts to address distortions in the rental market and enhance tax compliance among landlords benefiting from the growing demand for short-term rentals. Landlords renting fewer than three properties remain exempt under existing VAT rules, categorised as small-scale economic activities.
3. Replacement of the Accommodation Tax with the “Resilience Fee for Climate Crises”
Starting in 2024 and revised further in 2025, the previously levied accommodation tax has been replaced by a “resilience fee for climate crises.” This fee is imposed on hotels, guesthouses, and other accommodations, with rates based on property classification and capacity. The fee aims to fund climate adaptation measures and disaster recovery programs, reflecting Greece’s commitment to addressing climate change’s financial and social impacts.
4. Exemption from Insurance Premium Tax for Certain Health Insurance Contracts
Health insurance contracts for children under 18 will now be exempt from the standard 15% insurance premium tax. This measure is designed to alleviate the financial burden on families and promote access to healthcare for minors. The exemption applies to both individual and group insurance policies, provided that the beneficiary is a minor as of the policy’s effective date.
5. Introduction of a Cruise Passenger Tax
A new cruise passenger tax will take effect in 2025, applicable to individuals embarking on or disembarking from cruise ships at Greek ports. The tax is part of broader efforts to ensure equitable contributions from the tourism sector, particularly as cruise tourism imposes specific infrastructure and environmental costs. Rates and exemptions (e.g., for crew members) will be specified in forthcoming regulations.
