Voluntary principle restored to Greek owners' tax  - 14/10/2014

Varvitsiotis: "There were some false steps taken. I think that the issue will now be resolved."

GREECE'S government and the country's shipowners have agreed on a voluntary doubling of the industry's tax contributions worth an additional €420m ($529.5m) over the next four years.

The principles of the deal, and the headline amount, were agreed more than a year ago but the scheme was torpedoed last December when the country's finance minister pushed through a surprise new law hiking the tax haul even higher and making the levy mandatory.

That, and several other moves by the administration, undermined trust between the two sides but the latest deal shows that the government is keen to repair the relationship.

Since the start of 2013 the state has been collecting far more from the industry due to extending Greek-flag tonnage taxes to foreign-flag vessels managed from Greece. These account for three-quarters of the mighty Greek-owned fleet.

The new amendment restores the voluntary nature of the industry's extra contribution to the over-indebted nation.

It provides for shipowners to chip in €105m annually through 2017 on top of the regular tonnage tax.

A total of 478 shipping companies are signed up to the scheme.

The deal was expected to become law with a vote in parliament on Wednesday.

Minister of Shipping and the Aegean Miltiadis Varvitsiotis, prior to the parliamentary session, admitted the path to the agreement had been bumpy.

"There were some false steps taken," said Mr Varvitsiotis. "I think that the issue will now be resolved".

He said that there was "no other sector that has made a voluntary contribution to the Greek budget.

"I will be thanking Greek shipping for their contribution", he said.

Mr Varvitsiotis also said there was further work ahead to improve the competitiveness of the Greek flag, which has been leaking tonnage despite the inclusion of foreign-flag ships in the tax net.

It was "an endless race" to reduce bureaucracy in the flag administration and make it more competitive, he said.

in www.lloydslist.com 01/10/2014