Portugal to follow Greece with restaurant VAT rate cut?
The Portuguese government may shortly agree to re-classify restaurant food and services from the standard Portuguese VAT rate of 23% to the reduced rate of 13%. This follows news last week that Greece is lowering restaurant VAT rate from 1 August 2013.
The push to cut the restaurant Portugal VAT rate is being led by the opposition political parties which have made it a condition of supporting further governmental austerity measures. It believes the reduction could help create over 30,000 jobs in the crucial tourism industry. The cost of the proposed reduction would be €280m.
In Greece, the VAT reduction had to be approved by the bailout Troika, the IMF and IMF.