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Greek Islands Travel

Greek holiday tax crackdown

Holiday visitors to the Greek Islands may spot officials snooping around apartment complexes, tavernas and even beaches this year.

There is no need for holidaymakers to worry but hotel and taverna owners, and even those charging for beach umbrellas, should be rather more nervous

The snoopers are most likely government inspectors trying to track down on tax avoidance and police checking on labour law violations.

Tax and labour squads have stepped up inspections across the Greek islands this year after reports that more than half Greek tourism businesses were found to be flouting the law in the first three months of the year.

Popular tourist islands from Kos to Kefalonia are being targeted as the Greek government cracks down on tax avoidance.

It used to be normal practice for Greeks to avoid paying taxes whenever they possibly could.

Receipts for meals and drinks, even rooms for rent, were rarely offered or asked for as islanders relied on a cash-only economy.

But since the country went into debt, surviving only on regular bailouts from the EU and IMF, things have changed dramatically.

Avoiding VAT can trigger fines of up to €500 each and serious offenders can have businesses shut down for 48-hours.

Greek Labour Ministry warned: "SEPE has focused on the tourism industry earlier than any other year with the collaboration of tax squads and tourism police.

The recent tax crackdown saw more than half of 4,800 tourism-related businesses inspected in the first three months to be dodging tax or in violation of employment laws.

Lost revenue is estimated at €21.8 million, more than double that unearthed in first three months in 2017.

On-the-spot checks onf cafes and tavernas, rooms to let, car hire agencies and even beach umbrella rentals have been stepped up sharply with tax officials and tourism police taking on extra staff to carry out the unannounced inspections.

The Greek labour inspectorate (SEPE) launched 982 investigations of tourist related enterprises in May alone and imposed 325 fines amounting to €1.14 million and opened cases on 43 cases of breaches in employment law.

Noe the Greek National Tourism Organisation (GNTO) has called for even tighter checks on illegal accommodation.

They claim members who comply with the law are being undercut by Greek hotel owners offering short-term home rentals.

Meanwhile, rental prices of luxury apartments and villas in Greece's top tourist destinations continue to soar.

An increase in tourist arrivals on popular islands like Santorini and Mykonos has pushed up demand for high-end accommodation.

The demand for leasehold property is particularly high with a survey of Mediterranean destinations finding the Greek islands are the top choice for those wanting to rent a holiday home in the Med.

The average weekly rent of a three-room luxury villa on Mykonos this year went up &euro1,000 to €11,500, according to an Aegean Properties report.

Other islands reporting soaring rents of 50% or more are Santorini, Paros, Rhodes and Skiathos.

Other islands with marked red rises this year are Crete, Kefalonia, Corfu and Zakynthos.

Some are cashing in on the demand with innovative holiday rentals. One holiday rental owner on Lefkas is offering accommodation in a yacht, parked bed the pool in a holiday complex.

He is charging visitors around €200 per night to stay 'aboard' the yacht which is parked on a hill at Apolpaina, next to a swimming pool.

The yacht has two bedrooms, kitchen, dining area, two bathrooms and shower with 'a panoramic sea and city view'.

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