Following the Greek financial bailout package, Athens was pressured to terminate a regime of subsidised VAT rates for its popular touristic islands.

Mykonos, Naxos, Paros, Rhodes, Santorini and Skiathos are amongst the beneficiaries that will see their VAT rates riske from 5%, 9% and 16% to 6%, 13% and 23% in the coming days. Other islands will see the same measure shortly.

Many fear that such rise may have an undesirable effect and rather than collect more tax money, it will make the islands less attractive to tourism and ultimately render even less return to the Greek coffers.

What do you think? Is an increase in VAT counterproductive or a necessary evil?