Significant changes to property taxation and management are introduced by Greece’s new Local Government Code, according to a statement from the Panhellenic Federation of Real Estate Owners (POMIDA). The federation outlines key provisions affecting property owners, tenants, and municipalities following the law’s enactment.
Major Changes for Property Owners
The first major change concerns the merger of two existing levies—the Tax on Immovable Property (TAP) and the tax on electrified spaces—into a single new charge: the Local Development Fee. This fee will apply at a rate ranging from 0.30% to 0.70%. Starting in 2027, it will be collected through electricity bills. In rental cases, the amount will be offset against rent unless the lease agreement specifies otherwise.
Reduced Fees for Vacant or Non-Electrified Properties
A substantial reduction is introduced for the Cleanliness and Lighting Fee for properties that are either unoccupied or not connected to the power grid. In such cases, the fee will be calculated at just one-tenth of the standard rate. Eligibility for this reduced rate will be applied automatically once electricity supply is disconnected, with the Hellenic Electricity Distribution Network Operator (DEDDHE) notifying the relevant municipality.
Abolition of the ‘Right of Height’ Levy
The so-called “right of height”—a historical levy tied to vertical building rights—is formally excluded from the new fee structure. In practice, this charge has long been inactive and carries no meaningful economic value.
Revised Rules for Leasing Private Property to Municipalities and Regions
Leases of private real estate to local or regional authorities (OTAs) may now last up to 12 years, with the option to extend for another 12 years—subject to a formal decision and the owner’s consent. The aim is to enhance flexibility in meeting public housing and administrative space needs.
New Collection Mechanisms for Municipal Fees
The new Code allows municipalities to gradually shift away from collecting local fees via electricity bills. Alternative collection methods—including dedicated digital platforms or the Independent Authority for Public Revenue (AADE)—are now permitted, though the law does not prescribe a specific mechanism.
POMIDA warns that this shift could increase administrative burdens for property owners. For rented properties, it may also create complications: if fees are legally assigned to tenants but not clearly stipulated in the lease, owners may end up paying them upfront and seeking reimbursement later—a process that could discourage property leasing altogether.