Myconos, Santorini to be hit first as Greece scraps lower sales tax bracket for its islands

The sales tax on goods and services at six major Greek Aegean Sea tourist destinations will rise 30 percent this week as a new batch of creditor-demanded reforms kicks in.

Tourism-reliant Greece's Finance Ministry says the increases will affect the islands of Myconos, Santorini, Rhodes, Naxos, Paros and Skiathos, with the top bracket rising from 16 to 23 percent Thursday. The same will eventually apply to all Greek islands, which hitherto enjoyed a lower sales tax bracket than the mainland.

That is being abolished under new economic reforms and public revenue-boosting measures agreed in July. In exchange, international bailout creditors granted financially-struggling Greece a new rescue loan program worth 86 billion euros ($96 billion).

The Finance Ministry said Monday it hopes to talk creditors into revoking the increase next year.

[AP]