Value-added tax (VAT) in the restaurant and catering sector in Greece will be reduced from its current 23% to a new rate of 13% as from August 1, announced Prime Minister Antonis Samaras.

According to Mr Samaras this is the first time that the troika has agreed to a tax reduction, because the catering sector reassured him that the implementation of this measure would bring in higher revenues to both business and the state.

He then went on to worn that “if tax evasion continues as usual, VAT will return to 23%. But if it works out, I am sure more reductions in difficult taxes will follow”.

Announcing this initiative in a televised address to the Greek nation, he also said that certain measures included in the country’s bailout memorandum would not be applied until next year, “which means that there will be no new cuts in military pensions and salaries; nor will there be an additional tax of 0,002% on business turnover”.