The government rejected the MP’s request to reduce the VAT by 10% in the electricity bills, stressing that the VAT is not a targeted measure.
The deliberations on the issue continued today before the House Commerce Committee. “We request the reduction of the electricity bills by 10% via the VAT cut. It is allowed by the European Union”, Chairman of the Committee, Lefteris Christoforou said.
Mr. Christoforou stressed that the consumers are burdened by other taxes in EAC’s bills too.
“They pay 15% VAT, 0.22 for the Renewable Sources of Energy plus VAT. This means that the additional burden stands at 18”, he said.
DISY MP, Christos Stylianides, AKEL MP, Andreas Mouskalis, DIKO MP, Angelos Votsis, EDEK MP, Giorgos Varnava and Ecologists MP, Giorgos Perdikis agreed.
On the other hand, Finance Ministry Chief Economic Officer, Stavros Michael, explained the reasons why doesn’t the government adopt the measure above.
According to Mr. Michael, the proposals have three negative data:
- They are not targeted and might be loss making for the state
- They will create distortions between the lower and higher classes
- There will be an increased administrative cost for EAC
“The government is reviewing other measures, which are targeted and will address to lower classes, while its efforts will focus on other measures too that will support economy in the conditions of the global crisis”, he added.
On behalf of the VAT Service, Mr. Nicolaides said that the VAT is not a cost, since it is given back.
The members of the Committee decided to discuss the issue again next Monday in the presence of Finance Minister, Charilaos Stavrakis and Commerce Minister, Antonis Paschalides.
The deliberations on the issue continued today before the House Commerce Committee. “We request the reduction of the electricity bills by 10% via the VAT cut. It is allowed by the European Union”, Chairman of the Committee, Lefteris Christoforou said.
Mr. Christoforou stressed that the consumers are burdened by other taxes in EAC’s bills too.
“They pay 15% VAT, 0.22 for the Renewable Sources of Energy plus VAT. This means that the additional burden stands at 18”, he said.
DISY MP, Christos Stylianides, AKEL MP, Andreas Mouskalis, DIKO MP, Angelos Votsis, EDEK MP, Giorgos Varnava and Ecologists MP, Giorgos Perdikis agreed.
On the other hand, Finance Ministry Chief Economic Officer, Stavros Michael, explained the reasons why doesn’t the government adopt the measure above.
According to Mr. Michael, the proposals have three negative data:
- They are not targeted and might be loss making for the state
- They will create distortions between the lower and higher classes
- There will be an increased administrative cost for EAC
“The government is reviewing other measures, which are targeted and will address to lower classes, while its efforts will focus on other measures too that will support economy in the conditions of the global crisis”, he added.
On behalf of the VAT Service, Mr. Nicolaides said that the VAT is not a cost, since it is given back.
The members of the Committee decided to discuss the issue again next Monday in the presence of Finance Minister, Charilaos Stavrakis and Commerce Minister, Antonis Paschalides.
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