Athens without the consent of the European lenders have extended the regime of tax breaks on five of its Islands.
Germany at the meeting of the Eurogroup – the Council of Finance Ministers of the 19 Eurozone countries blocked the payment of the last tranche of aid to Greece in the amount of 15 billion euros.
The reason was the decision of Athens without the consent of the lenders to extend the regime of tax breaks on five Greek Islands: Lesbos, Chios, Samos, Leros and KOs. This was reported by the Greek newspaper Ekathimerini.
Following the meeting, the Finance Minister of Portugal mário Centeno, occupying the post of head of the Eurogroup, told journalists: “the Resolution on the payment of the last tranche of 15 billion was ratified by 18 countries.”
“The final decision on the formal conclusion of the consideration of prerequisites and approval of payments may be made after all national procedures. Expect that this will happen in early August,” – said Centeno.
According to the dpa news Agency, Athens promised to raise the VAT on the Islands to the standard level of 24%. Later they, however, reversed the decision, leaving rates at 17% until at least the end of 2018. The reason Greece has called an increased load on these Islands due to arrivals of refugees to the region. As noted by the Greek authorities, for this reason, in the local budget deficit of 28 million euros, who hoped to fill through reduced tax rates.
According to Ekathimerini, Greece’s Finance Minister, Euclidis Tsakalotos at the meeting of the Eurogroup promised that from January 2019 VAT will be increased.
Greece out of the crisis. How Athens did it
Now before listing tranche a Committee of the Bundestag budget Committee will need again to give the green light to the loan, despite the fact that in June the German Parliament has already approved the allocation of the last tranche of financial aid to Athens in the framework of the European stability mechanism (EMS).
After a Berlin of the ratification of the funds will be transferred. It is expected that it will be able till August 20, when program support ends. A significant portion of the allocated amount was to go to the formation of Greece backed financial reserves.
In June it was reported that Greece was freed from financial dependence on the EU. The previous tranche for Greece in the amount of 6.7 billion euros was agreed by the Eurogroup in January..
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