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Riot police in Greece on Saturday dispersed hundreds of protesters demonstrating against a tax on luxury products that is expected to raise about $1 billion.

Greece already had some of the highest taxes of any European Union country, but on Saturday, the high taxes were to become even more burdensome for the poor due to a levy on goods worth more than 2.4 million euros ($2.4 million).

Riot police clashed with demonstrators, many of whom waved Greek flags and used red-stained signs to call for “the abolition of this outrageous tax” and for the government to “pay a lot, not a little.”

A number of smaller protests also took place with a number of demonstrators chanting, “Greece for the Greeks.”

The Athens-based Hellenic Center for Economic Policy and Research (ECEMD) estimated the new VAT would total about 30 percent of goods sold nationally. The VAT is expected to raise some €1.3 billion ($1.4 billion) a year.

The Greek government, which said it is implementing several austerity measures to get the economy back on track, wants to hold talks with the IMF over a European rescue package. But the government has yet to put forward any proposals.

The country ranks among top eurozone countries in terms of unemployment but also among some of the lowest levels of wealth inequality. While the gap between the richest and the poorest is much smaller in Greece than in other eurozone countries, they are still huge.

The government would not estimate the real impact of the VAT, including the cost of providing the services and paying to import goods, but said it was likely to raise about $1.3 billion a year.
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