[260815.EN.BIZ] Cash-strapped Athens May Raise Tonnage Tax 4pc For Greek Foreign-flag Ships

GREECE's shipping industry could face a tax increase, as part of the austerity measures in the financial bailout terms with the European Union.

Before Prime Minister Alexis Tsipras' resignation sparked calls for a snap election so he can retake power amid growing opposition to the austerity, it was originally agreed that the tonnage tax be imposed on Greek foreign-flagged ships owned by Greeks covering the four years from 2016 to 2020.

The new law could also include a tax rate reduction on foreign currency brought to Greece by overseas companies exclusively engaged in insurance, chartering, brokerage and shipbuilding. Excluded from the rules are domestic route cargo ships, reported London's Tanker Operator.

Union of Greek Shipowners president Theodore Veniamis said any change in the existing tax regime would induce owners to seek a friendlier tax environments.

At present, Greek shipowners enjoy constitutional tax breaks, including no profits tax on shipping operations and ship sales. Changing these laws would require a two-thirds majority in parliament.

Source : HKSG.