Greeks Stock Up on Staples Before Tax Increase

Taxes in Greece will increase on January 1st on basic products such as tobacco, coffee and olive oil. Locals and traders are stocking up before the higher costs take effect.

Ermou Street, Athens
Dec. 31, 2016
By Claire Ngonga-Gicquel
Ermou Street, Athens

Recent News

The econ­omy in Greece is still stuck on the dif­fi­cult side. With taxes on olive oil ris­ing from 9 per­cent to 13 per­cent tomor­row, many Greeks are rush­ing to buy and stock up on the sta­ple among other prod­ucts. Every hour counts, espe­cially for those in the trade who have boosted their stocks in the past few weeks.

Some peo­ple are hop­ing to make stocks for six months,” said Giorgos Kourasis, gen­eral sec­re­tary of the Greek Federation of Catering Trades. It is a real tsunami of taxes that are falling on us, in this sev­enth year of reces­sion. Something we have never seen — and pro­fes­sion­als will have to absorb this increase so as not to lose their clients.”

Many sec­tors are affected by the VAT increases, includ­ing tele­phone, cable tele­vi­sion, gaso­line, elec­tronic cig­a­rettes and tobacco. The lat­est increase on cig­a­rettes hap­pened not even eight months ago,” Kourasis said. Greeks are going to buy ille­gally from neigh­bor­ing coun­tries.”

Traders fear a drop in sales to tourists who are keen on Greece’s flag­ship prod­uct. The rush is less vis­i­ble in super­mar­kets, but pro­fes­sion­als fear a drop in the con­sump­tion across the board. This could be the case for cof­fee, which is also con­sub­stan­tial to the Greek life, as it will increase from €2 to €4 per kilo on aver­age.

For Greek peo­ple, the Year 2016 has already been quite hard with higher VAT and new gov­ern­ment taxes apply­ing to basic prod­ucts.

In May 2016, the press was mak­ing jokes on the dras­tic eco­nomic mea­sures: Only the air that we breathe will not be taxed,” a head­line read, after the new pack­age of mea­sures pro­posed to the Greek Parliament on May 23 in exchange for a release of a €5.4 bil­lion loan.

The Greek MEPs adopted the new mea­sures requested by the coun­try’s cred­i­tors as a con­di­tion for unblock­ing the loan. The weak major­ity of the gov­ern­ment, led by Alexis Tsipras, had just passed a very unpop­u­lar 7,000-page bill.

The law included a mech­a­nism for auto­matic cor­rec­tion in the event of fis­cal slip­page and addi­tional mea­sures to accel­er­ate pub­lic com­pa­nies pri­va­ti­za­tion. And the series of mea­sures also included a bar­rage of taxes, one of which tar­geted the hotel indus­try. Various taxes also weighed more on con­sump­tion prod­ucts, includ­ing olive oil.

So the start of 2017 does not look to bring much relief.


Advertisement

Related News

Feedback / Suggestions