In light of the urgent need of the Greek Government to reorganize public finances, an additional tax was imposed on television advertising. The law n. 3845/2010 provides for a 20% special tax on television advertising. The new tax shall be borne by either the entity being advertised or the advertising agencies and it shall be collected by the TV broadcasters who in their turn will remit it to the tax authority.
Upon hearing the new measure, the Greek TV channels’ managers expressed their disappointment arguing that this tax is discrimination against television vs. other media. They expressed also the fear that the new tax will be counter-productive, as the Greek commercial broadcasters will have to re-examine their cost base due to the unexpected tax increase.
It should be noted that with the new tax, the overall taxation imposed on TV advertising reaches 64,5%, given that there is already the VAT of 23%, plus an additional tax of 21,5% for the advertising business to be paid into the journalist pension funds.
The whole matter did not stay within Greek borders, as the Association of Commercial Television in Europe (ACT) called on the Greek Government to rethink its decision for extra taxation on TV advertising and on the European Commission to examine the compatibility of these measures with European law.
In view of the above reaction of the advertising and TV industry, the Greek government announced that the new tax will not come into effect before 2013.