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

Greek Prime Minister Kyriakos Mitsotakis introduced measures aimed toward addressing the adverse affect of overtourism as guests proceed to reach in file numbers within the post-pandemic period.

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 Honest. It is going to additionally improve a tax associated to the climate-crisis on lodging.

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

The nation will even broaden its so-called “Golden Visa” program to buyers who’re keen to place no less than €250,000 ($277,000) into native startups. Foreigners have been beforehand required to purchase property to amass the visa.

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

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

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

The federal government will ban any new short-term leasing for no less than one 12 months in three major elements of Athens, Mitsotakis stated. Property homeowners who change leases from short-term to long-term received’t need to pay rental tax for 3 years, as will homeowners who determine to hire their houses as a substitute of retaining 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, in response to information printed in a Grant Thornton report for the nation’s Chamber of Resorts launched this week.

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

Extra Measures

Mitsotakis on Saturday additionally revealed a variety of measures aimed 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 reduce.

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 docs, firefighters and employees within the military and coverage forces.
Numerous tax reliefs to assist the self-employed, farmers and others
Adjustments to unemployment advantages

“I don’t have a sack of reckless spending immediately,” he stated. “Our spending for 2025 is nicely balanced.”

Greece has already pledged to fulfill a funds main 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 without doubt one of the most vital standards for monetary markets, and the nation’s latest prudent funds path was one of many drivers for rankings firms to return Greece to the funding grade zone in 2023 after 13 years at junk standing.

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

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