Income Tax
Greece uses a progressive income tax system, which must be paid by both employees and business operators. Permanent residents are taxed on their income both within and outside of Greece. Employers deduct income tax from employees' salaries monthly and remit it to the tax authorities.
Social Security Tax
Like most EU member states, employers in Greece are required to withhold social security tax from employees and contribute a portion themselves. The employer's contribution is 28.06% of the salary, while the employee's contribution is 16%.
Corporate Tax
Foreign companies are only taxed on profits earned within Greece. At the beginning of 2007, the corporate income tax rate was 25%. Starting from 2010, the corporate income tax rate decreased by 1% annually, reaching 20% by 2015.
Capital Gains Tax
Unless otherwise specified by law, capital gains in Greece are taxed at the same rate as corporate income. Withholding Tax: Since January 2009, Greece has imposed a 10% withholding tax on corporate dividends, unless the dividends are subject to the EU Parent-Subsidiary Directive or qualify for a lower tax rate under a bilateral tax treaty. Withholding tax also applies to interest and royalties, unless reduced or exempted by a bilateral tax treaty, or if the fees are subject to the EU Interest and Royalties Directive.
Value Added Tax (VAT)
The VAT range in Greece is 4.5% to 23%. The VAT rate for goods not falling into any special category is 23%. According to the Greek newspaper Imerisia, Athens has agreed to the lenders' proposal to reduce the VAT rate from the current 23% to 20% to secure support from opposition parties for austerity measures aimed at further reducing the budget deficit. The tax rate on items such as food will be reduced from 13% to 10%.