Greece :: Lawyers Down Tools Over Introduction of VAT on Their Services

Greek Lawyers Down Tools Over Introduction of VAT on Their Services

Greece's lawyers down tools over the Athens Government decision to impose value added tax (VAT) for the first time, and at the 23 per cent rate on all their invoicing to clients. In effect every time a contract is signed or work undertaken by a lawyer it will now attract a VAT fee at 23 per cent. That of course means all clients will be affectively paying a 23 per cent increase in the cost of engaging a law firm or engage legal services such as notary publics.

The lawyers say this is unfair on constitutional grounds. Why? Lawyers say that they are regarded as public servants under Greece's constitution. If they are public servants they are then on the same footing as any other government person. If I am correct, this means that there is no 23 per cent levied on government transactions signed off by civil servants. Therefore lawyers ay they need also to continue to be exempt. Lawyers say that it may have to take a constitutional amendment to pass through Parliament to affect the change, or the VAT levy on legal fees challenged in the Supreme Court of Greece, or even challenged in the European Human Rights court.

During this dispute with the government over the status of lawyers, the legal profession has downed tools and refusing to handle any legal matters. In some prefectures, some exceptions are being made in drawing up contracts.

In Crete the local Bar Associations of Lasithi and Heraklion Prefectures say it is OK, if you are buying/selling a property it is still possible to move forward to work on preparing property contracts. It is my understanding that in Chania and Rethymnon Prefectures, it is a total strike and the two bar associations have directed that no exceptions will be made with total downing of tools.

Across Greece it is up to the local Bar Association of each prefecture whether to make this exception.

In respect of court proceedings it is calculated that as all court trials and hearings have been stopped for the duration of this dispute - until at least July 7th, it is being calculated that due to heavy work load of the Greek judicial system, no new cases can be scheduled until two years later from now i.e. 2012 - thereby further clogging up the court system with longer lead times to scheduling judges time. This will be particularly true in Crete's Chania, Rethymnon, Lasithi and Heraklion prefectures.

Anyone who has bought or sold property in Greece, or used a lawyer for other reasons, will be aware of the local bar association. Your lawyer adds a local bar association fee to every billing for services rendered. The amount is based on a scale of fees depending on the type of transaction.

The date of July 7th, 2010 is important. That is the day the General Assembly of all the regional Bar Associations of Greece is to meet in Athens to decide on what action to take against the government's ruling.

See also the other reason lawyers are up in arms at the moment and downing tools with legal practices not operating properly throughout Greece.