The Panhellenic Federation of Catering and Related Professions (POESE) has urged Prime Minister Kyriakos Mitsotakis to reinstate a reduced 13% VAT rate for the hospitality sector and abolish the Special Consumption Tax (SCT) on coffee. In a formal letter to the Prime Minister, POESE frames these measures as essential to restoring tax competitiveness for one of Greece’s largest economic sectors — a sector it says continues to operate under fiscal burdens imposed during the bailout years, long after Greece exited its memorandum regime.
Tax Burdens Out of Step with Today’s Economy
POESE argues that current VAT rates — which returned to 24% for much of the sector in 2024 — are historically high, representing the heaviest tax burden on Greek catering in the past 35 years. From 1992 to 2011, the sector benefited exclusively from reduced VAT rates ranging from 8% to 13%, reflecting official recognition of its role in employment, tourism, regional development, and public revenue generation. The federation notes that the hikes to 23% and then 24% were emergency fiscal measures introduced under the memoranda — measures that remain in force despite Greece’s improved fiscal position and strong primary surpluses.
A Broken Election Promise
The federation cites the government’s recent slogan — “We said it, we did it” — as a catalyst for its intervention. It points to a key pre-election commitment made in 2019: a gradual shift toward just two VAT rates — 22% and 11% — with catering explicitly cited as a model sector where lower rates could be applied without revenue loss. POESE recalls that public statements from that period referenced the 2013–2014 VAT reduction for catering, which — contrary to initial forecasts — did not create a fiscal gap. Instead, the sector’s performance demonstrated that targeted tax relief can support growth while maintaining stable revenues.
Coffee Tax: A Double Burden on Daily Consumption
POESE describes the SCT on coffee as a purely ‘memorandum-era’ tax that weighs on both businesses and consumers. It highlights the double taxation on coffee — subject simultaneously to the SCT and a 13% VAT — calling it disproportionate for a staple daily product. The federation warns that such overlapping levies exacerbate cost pressures already straining the sector.
Mounting Operational Pressures
Citing Hellenic Statistical Authority (ELSTAT) data, POESE reports 15 consecutive months of declining turnover in the catering industry. It adds that overall operating costs have risen by approximately 40%. These financial strains are compounded by other challenges — including rising energy prices, labor shortages, and increasing compliance demands — though the full list is cut off in the original text.