The GZS warned that the grocers' plan to shift the entire cost of the rise in VAT rates on 1 July onto their local suppliers and distributors for three months would mean at least EUR 4.5m less in revenue for the food industry.

This would in turn mean a loss of revenue from the VAT rise for the state, the GZS said, adding that by jeopardising jobs and wages at distributors and suppliers and consequently reducing purchasing power, the retailers' move would amount to scoring an "own goal".

The chamber maintains that it is in the retailers' best interest to treat local suppliers and distributors differently than other suppliers.

The standard VAT rate will be increased to 22% from 20% and the reduced rate to 9.5% from 8.5% on 1 July as part of the government's efforts to fill up the widening budget hole.