Rich Greeks Face Luxury Tax



Aerial view of home swimming pools in Athens
Aerial view of home swimming pools in Athens

With the rich and politicians largely escaping sacrifice during Greece’s crushing economic crisis – some are even prospering as never before – the government said it will slap a luxury tax on the wealthy, those who who big, fancy cars, swimming pools and airplanes in a bid to raise critically-needed cash with revenues off expectations despite big tax hikes.

Owners of cars with an engine capacity of 1,929 cc or over, swimming pools or aircraft will be expected to pay the special luxury item tax at the end of the year, probably in one installment, unless the finance minister decides otherwise.  That would come at the same time they, as well as other vehicle owners, have to pay an annual road tax that ranges between 5-10 percent of the value.

The luxury tax, which had also been imposed in 2011 for just one year, is expected to fetch between 100 and 130 million euros this per year and is permanent. For this year only, those affected will be informed with a special slip and as of next year it will have to be paid along with their income tax.

The government didn’t explain how it would enforce or collect either the income or luxury tax from rich tax evaders who hide their income in foreign countries and don’t declare their assets, especially swimming pools. A government survey by aircraft two years ago found thousands of Greeks had swimming pools but didn’t list them so they could avoid being taxed. No one has been prosecuted.

Taxpayers with a five-year-old car of 1929 cc will have to pay 418.70 euros, while owners of 3,000 cc vehicles must pay 1,780 euros. Vehicles that have been circulating in Greece for more than 10 years are exempt, as are those used by people with disabilities, which are also exempt from road tax.

The airplane tax also includes gliders and has been doubled since two years ago, totaling 10 percent of the objective value of each aircraft. The same rate will apply to swimming pool owners, meaning that a pool of 30 square meters will be taxed at 480 euros.