In an effort to meet the State’s deficit goals and achieve an immediate increase of public revenue, the Government, by means of an amendment to a bill brought before parliament, introduced a new property tax called “Special Duty on buildings powered by electricity” (the “Special Duty”), according to Zepos & Yannopoulos Law Firm.

Pursuant to the aforesaid amendment, the Special Duty will be imposed in 2011 and 2012 on all buildings connected to the electricity system, either commercial or residential, which have been subject to another similar duty since 1993, namely the Municipal Real Estate Duty. It is noted though that, according to the latest information released in the press, the levy of the Special Duty will be extended until 2014.

The Special Duty shall be borne by the owner(s) of the building or by the holder(s) of usufruct rights, as the case may be. Special Duty shall be paid to the Greek State through the utility bills issued by electricity providers. With respect to leased buildings, the Special Duty will still burden the lessor, whilst any agreement to the contrary between the lessor and the lessee is explicitly prohibited. Therefore, lessees will pay the Special Duty to the Greek State through the corresponding utility bill but they will be entitled to set off said amount against the future monthly rental(s) due to the lessor.

According to the international real estate advisor Savills, it is expected that this special duty will further affect the currently poor real estate environment with immediate effect on the transactional levels of the market. In case that this duty may become a permanent measure, then the market will incorporate this burden in the price levels.