All About the VAT Tax in Greece

Greek Drachmas and Euro change.
••• Christian Ohde / Getty Images

Travelers to Greece may see "VAT" taxes added to many receipts. It can be hefty - up to 25% of the total, but the good news is that some of the VAT taxes can be refunded at the airport if you're willing to take the time to prepare.

What Does VAT Stand For?

VAT is the acronym for Value Added Tax, a surcharge on most goods and services in the European Union. In Greek, it is called the FPA and you may see it as ΦΠΑ on a receipt, usually with a percentage nearby.

While citizens of the EU are required to pay the tax, travelers to Greece who are not European Union citizens can get some of the charges refunded when they leave Greece. There are individual purchase amount total minimums which must be met, as of this writing about 175 USD, and some merchants and hotel keepers will not want to give the VAT form because it provides documentation of your purchase to the government - something which might not be otherwise provided. (A recent sweep of hotel keepers on the Greek island of Rhodes by authorities dispatched from Athens found that virtually all hotels were inadequately documenting their income.)

Different types of purchases will incur different levels of VAT tax. In the summer of 2011, Greece raised the VAT tax on many food purchases to 23%. The tourist industry is protesting the change, as its provisions are confusing, but given the Greek financial crisis, it is likely to stay in place.

If you have purchased a package tour, there is now a difference in the VAT tax for the lodging portion and the VAT tax for the food portion, so expect some numbers that don't seem to quite add up. Generally, one-third of the package tour cost will be placed in the "food" category charged at the higher VAT tax rate.

How to Get a VAT Refund in Greece

1. Look for the "VAT Refund" or "Tax-Free Shopping Network" or similar sign in a shop window. That indicates that the store is participating in the program, or at least claiming to. Since a purchase minimum is required, you will usually only find these signs in more upscale shops where the average purchase is likely to exceed the minimum - art galleries, better clothing stores, jewelry shops, and similar places of business. But the VAT refund also applies to hotel bills, rental cars, and other providers of services to tourists who are from outside the European Union.

The merchant will ask to see your passport, so have it with you for major purchases. You can try using a full-color copy of your photo and information page in your passport, but it may not be accepted. This is the worst thing about the VAT program - having to risk carrying your passport around with you while shopping, but for major purchases by credit card, some merchants may require a photo identification anyway.

2. Make your purchase, ask for your receipt, and ask for the VAT refund form. There's a lot of incentive for the merchant to "forget" the form, so be sure you receive it.

3. At the Airport, bring the item you purchased (not always checked but they can ask), the receipt, and the form to the VAT refund desk located at the Eurochange currency exchange offices on the Departure level.

You may see a sign for "Global Refund" or "Premier Tax-Free".

Obviously, if you intend to put the item you purchased into your checked luggage to carry back home, you need to process the refund before checking your luggage. Otherwise, keep it in your carry-on bag.

The Gate to Greece blog warns travelers seeking VAT refunds that some merchants will claim tourists must get the form at the airport, but this is not the case. The merchant must issue the form along with the receipt.

You may also be able to take advantage of a service to reclaim your VAT, though the fee will eat up some of the refund: Quick Fact on Greek VAT

One possible result of the Greek financial crisis? If Greece leaves the Euro and the European Union - which some experts feel will be a necessity - the V.A.T. tax will no longer apply.

But in that case, expect it to be swiftly replaced by Greek national taxes.