The finance ministry on Friday unveiled clarifications over a controversial government decision to increase the VAT rate to 23 percent from 13 percent in the restaurant and cafe sector, a decision that generated widespread criticism, particularly by the all-important tourism sector.
According to a circular released by the ministry, only 5 percent of a hotel guest's total bill will come under the 23-percent rate if the stay includes a breakfast; 15 percent for a stay that includes breakfast and lunch, and 30 percent of the total bill will be calculated with the 23-percent rate for "all-inclusive" packages.
Packaged foodstuffs ready for consumption will remain at 13 percent, however, restaurants and taverns, will have to add 23 percent VAT to bills.