VAT on private education may be suspended

The caretaker government looks set to delay the imposition of a 23 percent value-added tax rate on private education for two months, leaving it up to the administration to be formed after the September 20 elections to decide whether to scrap the measure.

The General Secretariat for Public Revenues informed private schools and tuition centers on Monday that they have until September 8 to register for VAT.

This is a move designed to give the caretaker government enough time to issue a legislative decree suspending the decision to impose the levy on the sector as it extends the original deadline that schools had to meet for VAT registration by eight days.

Should Greece’s lenders agree to this move, the new government would then have a small window of opportunity to come up with alternative fiscal measures worth roughly 350 million euros which the 23 percent VAT on private education was expected to raise this year and next.

It is thought that the delay in issuing the decree may be because Greek authorities are consulting with the country’s creditors.

The European Commission wrote to Athens last week to ask for the measure, which would not apply to non-profit institutions, to be scrapped. No other European Union country charges VAT on private education.

Schools and parents have also complained about the imposition of the levy, with tens of thousands of people signing a petition against it.