Kerin Hope
September 1, 2011

Tax evasion in Greece threatened to take organised form on Thursday when café and restaurant owners refused to pay a 10-point VAT hike, as a deep recession clashes with the government’s increasingly desperate search for revenue.

The steep rise in value added tax on the hospitality sector from 13 per cent to 23 per cent is part of a package of fiscal measures agreed in return for the country’s second financial rescue by European Union partners.

But for many of Greece’s ubiquitous cafés and souvlaki stands, which have already seen a 20-40 per cent decline in business in the past year as customers rein in spending, the VAT rise is the final straw.

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