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Why is it expensive in Greece?

05 December 2010 / 18:12:15  GRReporter
3996 reads

Victoria Mindova

 

Unexpected and even surprising proved to be a series of other taxes, fees and payments imposed on products and services that Greeks enjoy every day. The additional tax burden from them, however, doesn’t help them with the better quality, and they only burdens the anyway increased (compared to the productivity of the country) prices and further reduces the competitiveness of the local economy. After the Greek government and the Triple of the International Monetary Fund, European Central Bank and the European Commission agreed that Greece needed financial and administrative restructuring, on the surface came out the most unexpected fees and taxes withheld for years.

Tickets for ferries and other types of passenger shipping in Greece are charged with the 14.5% additional fees (except for the imposed VAT). Passengers pay an amount which not only includes the cost of transport to any destination in the country, but a bunch of other services for clear and obscure institutions, organizations and funds.

Three percent of the amount goes into the account of "Coastal Transport". 6.5 percent goes for insurance of passengers and transportation vehicles in the pension fund of the navy under Law 2575/1998 (State Gazette). The problem is that their insurance is established and mandatory imposed by another law that makes the 6.5-percent a surplus. Other 5% of the ticket price goes for the use of the port to board and disembark. The fee for lost benefits on the other hand costs between four and eight per cent of the ticket price for shipping and applies to vehicles up to and over five tons. It is imposed on the island of Crete, because the transport on the island has not opportunity for the development of the business as their competitors in mainland Greece. According to Law 3170/1955, which still continues to apply, eight percent are taken from the revenues of the state ports for jobs that no longer exist for the pension fund of the navy.

The price for the end user of shipping companies is charged with 80.1 percent additional charge over the basic price, and the biggest part of this money goes into the fund of the Commission for Supervision of road transport in Greece. Business circles in the country insist that with the liberalization of the transport market to gradually eliminate the additional fee and each year in the next five years to be reduced by 20%. The price of each bottle of gas for domestic use is charged with eight per cent which go to the Ministry of Economy and Regional Development, with no explanation why?

Almost offensive seemed the discovery that, under Article 12 of Law 1080/1980 from each beer sold in Greece, 3% goes to the Organisation for Local Government, which includes all municipalities and town halls in the country. Those municipalities the most of which today have either gone bankrupt or are on the verge of bankruptcy because of mismanagement and unusually high costs. In addition to the excise duty on beer and the fee for municipalities, there is also a second charge on the malt, which is paid under the law 2963 from year 1922 and should go for insurance of agricultural workers. Other two percent come into the fund of the municipalities from the publication of advertisements and the development of advertising industry. Another 20% (for the print media) and 21.5% (for electronic media) are deducted as an advertising tax which is levied on the gross amount of ad service and VAT of 11% is paid separately, and after about a month it will be 13% .

Paper and printing services can also boast with additional charges that increase the final price without being absolutely clear where the money from them goes. 2% is imposed additionally on the initial cost for production and sale of paper, paperboard and pulp. Another half a euro cent is paid for each newspaper sold and two euro cents for each magazine go to the account of printers and workers in printing companies. The problem is that after the recent changes large and small social security authorities will be merged into a single body. After reviewing the assets of public organizations, reform of the social security system turned out to be inevitable, because regardless of the constant revenues from charges and fees levied the funds by sectors of the economy are either empty or register huge deficits.

One percent of the annual turnover of all companies engaged in fuel distribution goes to Fund for supplementary insurance of employees in the sector. An income of 1.2% deducted before taxation goes into an account for financing companies trading with fuel in problematic areas of the country.

0.5% is added over the price of all goods imported into Greece, just because they are foreign. The amount collected is distributed between the Thessaloniki and Athens State University, and another one is designed to promote the export of Greek products abroad, without specifying the organization responsible for that. And while public schools are free and available for all, school fees in private schools and private lessons are charged with a 0.5 percent additional fee, the amount from which goes for the salaries of the unionists in the House of educators in the private sector.

The list of charges and fees on goods and services continues endlessly: 2% on the price of cement for the special additional fund for workers in the cement industry; 0.016 euro cents on each kilogram of flour, also for the fund for additional pension insurance in the sector. The main insurance fund for agricultural workers is filled each year also from additional charges, like the 3% on top of the purchase price of plant products and 0.5% of the price of animal products, fisheries and aquaculture.

Tags: Economy markets taxes fees high prices Greece
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