Overtourism: Greece to focus on short-term leases and levy port charges

The federal government has been “very involved” about an inflow of cruise passengers throughout sure months of the 12 months and can start charging charges, Mitsotakis stated Saturday throughout his annual speech on the Thessaloniki Worldwide Truthful. It’s going to additionally improve a tax associated to the climate-crisis on lodging.

Greece acquired a report 36.1 million guests in 2023, whereas arrivals rose 16% to 11.6 million within the first half of 2024, based on the most recent information from the Financial institution of Greece. The tourism sector contributes about 20% to the economic system, making it very important to the well being of the nation. 

The nation can even increase its so-called “Golden Visa” program to buyers who’re prepared to place not less than €250,000 ($277,000) into native startups. Foreigners had been beforehand required to purchase property to amass the visa. 

All passengers arriving at Greek ports can pay a charge, and the cost might be larger within the fashionable tourism islands of Santorini and Mykonos. A lodging tax for the April-to-October interval additionally might be elevated, with income benefiting native communities.

Mitsotakis reiterated concern that components of Greece face the issue of “overtourism.” In an interview with Bloomberg in June, he introduced plans to prohibit cruise ships visiting the nation’s hottest islands from 2025. 

Quick-term leases have been blamed for fueling the nation’s housing disaster, which together with excessive shopper costs has been on the heart of latest political debate. 

The federal government will ban any new short-term leasing for not less than one 12 months in three principal components of Athens, Mitsotakis stated. Property house owners who change leases from short-term to long-term gained’t need to pay rental tax for 3 years, as will house owners who resolve to lease their houses as a substitute of preserving them off the market, he stated.

Vacation leases elevated an annual common of 28% from 2019 to 2023, whereas obtainable short-term leases doubled in the identical interval. In the meantime, resort lodging rose simply 3.5% in that interval, based on information revealed in a Grant Thornton report for the nation’s Chamber of Motels launched this week.

The federal government can even start a brand new €2 billion program that might be used to scale back interest-rate prices for mortgage loans. 

Extra Measures

Mitsotakis on Saturday additionally revealed a variety of measures geared toward easing the price of residing, together with a discount in social insurance coverage contributions by 1 proportion level in 2025 as a substitute of a earlier plan for a 0.5 level minimize. 

The premier additionally introduced, amongst others:

• A 2.2%-to-2.5% improve in round 2 million pensions from Jan. 1.
• A rise in minimal wages starting in April
• A rise in public sector wages, particularly to medical doctors, firefighters and employees within the military and coverage forces.
• Varied tax reliefs to assist the self-employed, farmers and others
• Modifications to unemployment advantages

“I don’t have a sack of reckless spending right this moment,” he stated. “Our spending for 2025 is effectively balanced.” 

Greece has already pledged to fulfill a finances major surplus — an index that exhibits income minus spending excluding curiosity funds — of two.1% of GDP for each 2024 and 2025, up from 1.9% in 2023. 

Fiscal self-discipline is among the most essential standards for monetary markets, and the nation’s latest prudent finances path was one of many drivers for rankings corporations to return Greece to the funding grade zone in 2023 after 13 years at junk standing. 

“Wholesome and rising major surpluses, in tandem with sound nominal development, will facilitate additional important discount within the public debt-to-GDP, which is predicted to fall to under 140% by 2027, from 161.9% in 2023,” DBRS Morningstar stated Friday.