Greece votes to tax tips

CGTN Europe

Tips are now taxable in Greece following the Supreme Court ruling that service workers will now pay tax on gratuities.  Many workers are angry and have said that they use the tips to compensate for low pay.  CGTN’s Evangelo Sipsas has the full report ⬇️ https://tinyurl.com/4sztfzxd

Transcript

00:00The clatter of glasses, the sound of coffee making, and the hum of conversation,

00:06the usual soundtrack of a busy day at a bistro bar in Athens.

00:11But a new ruling by the Supreme Court here has struck a sour note for many workers,

00:17such as Georgios Pervikas, who has spent most of his working life in the industry.

00:23Taxing our tips will make our lives more difficult.

00:27The new measures will make us seriously reconsider whether we'll continue working in the hospitality industry.

00:34It makes us have second thoughts. It complicates our life.

00:38A situation already made more challenging by the high cost of living and the persistent high inflation.

00:45My quality of life would change even more.

00:48I'm at a point where I have to think twice about whether I can purchase or buy something for my home or pay the rent.

00:54You can't live in Greece just on a basic salary.

00:59Following the ruling, the Greek government says it's considering allowing workers to keep up to $300 tax-free.

01:07But the Supreme Court ruling will still mean workers will have to pay insurance and health care contributions on anything over $300.

01:17The ruling has sparked a heated debate, but the government isn't backing down, saying the law shouldn't surprise.

01:24A tax on tips law has been in place for decades, but it's only been recently enforced.

01:31It's interesting that people think we are implementing a new law and taxing tips.

01:37That's not the case. The law has existed since 1994.

01:41We are creating a monthly tax exemption for up to 300 euros.

01:46The government is pushing back, saying that these measures that are in place are not about taxing tips, but to create a fairer system.

01:55With electronic payments now in place, authorities say that they can track those hidden salaries that slip through the cracks.

02:04And they make sure that everybody will pay their share.

02:08And they insist that this system that is in place is already working.

02:13Electronic systems now reveal hidden taxable income, not just tips.

02:20These measures have led to an 11% VAT revenue increase over a billion euros, which previously went undeclared.

02:32While the government celebrates higher revenues and a crackdown on hidden incomes,

02:37Georgios Perdikas is concentrating on different numbers,

02:41wondering how he can continue to pay his bills if he continues in his lifelong profession.

02:48Evangelos Tsipsas for CGTN, Athens.

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