Minister of Finance Makis Keravnos has announced the implementation of 0% VAT on certain products, aiming mainly at vulnerable groups, young couples and the middle class.

The announcement was made following a 10 October meeting he had at the Presidential Palace with the President of the Republic Nikos Christodoulides.

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The products to be included in a proposal that will be submitted to the next Cabinet meeting, according to Keravnos, include children’s diapers, adult diapers, baby formula, hygiene products for women, fruits and vegetables. These products will be sold “with zero VAT, without a specific expiration date” for the measure.

“We believe that these products are products that mainly concern young couples, the middle class,” Keravnos said, adding that “we feel that at the moment it is time for this category of products to re-enter the zero VAT rate.”

The Finance Minister said that the economic policy followed by the Government “is a policy that aims to financial stability, sustainability and resilience of the economy in this difficult geopolitical environment that we live in, to strengthen the middle class and vulnerable groups.”

He noted that according to data the government presented, “as a result of the economic policy we are pursuing, the middle class has been strengthened and from 58.6% of the population in 2015 it has reached 64.1%.” Therefore, according to Keravnos, “the guiding principle of any economic and social policy is the strengthening of the middle class, which has traditionally been the backbone of the economy and the society.”
Asked about possible criticism regarding reintroducing products with zero VAT rate, Keravnos said that the government does not act on “any populism or unnecessary criticism” but “we are following and implementing policies based on the needs of the society and the economy.”