Tax Evasion in Greece Seems a Popular Sport ;-)
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In the wealthy, northern suburbs of Athens, where summer temperatures often hit the high 90s,
just 324 residents checked the box on their tax returns admitting that they owned pools.
In the wealthy, northern suburbs of Athens, where summer temperatures often hit the high 90s,
In the wealthy, northern suburbs of Athens, where summer temperatures often hit the high 90s,
just 324 residents checked the box on their tax returns admitting that they owned pools.
In the wealthy, northern suburbs of Athens, where summer temperatures often hit the high 90s,
just 324 residents checked the box on their tax returns admitting that they owned pools.
So tax investigators studied satellite photos of the area — a sprawling collection of expensive villas tucked behind tall gates —
and came back with a decidedly different number: 16,974 pools.[br]
That kind of wholesale lying about assets, and other eye-popping cases that are surfacing in the news media here,
points to the staggering breadth of tax dodging that has long been a way of life here.
Such evasion has played a significant role in Greece’s debt crisis, and as the country struggles to get its financial house in order, it is going after tax cheats as never before.
Various studies, including one by the Federation of Greek Industries last year, have estimated that the government may be losing as much as $30 billion a year to tax evasion —
a figure that would have gone a long way to solving its debt problems.
“We need to grow up,” said Ioannis Plakopoulos, who like all owners of newspaper stands will have to give receipts and start using a cash register under the new tax laws passed last month. “We need to learn not to cheat or to let others cheat.”
Many Greeks say they feel chastened by the financial crisis that has pushed the country to the edge of bankruptcy, according to this article in the New York Times.
But even so, changing things will not be easy. Experts point out that ducking taxes is part of a broader culture of bribery and corruption that is deeply entrenched.
Mr. Plakopoulos, who supports most of the government’s new efforts, admits that he and his friends used to chuckle over the best ways to avoid taxes.
To get more attentive care in the country’s national health system, Greeks routinely pay doctors cash on the side, a practice known as “fakelaki,” Greek for little envelope. [br]
And bribing government officials to grease the wheels of bureaucracy is so standard that people know the rates.
They say, for instance, that 300 euros, about $400, will get you an emission inspection sticker.
Some of the most aggressive tax evaders, experts say, are the self-employed, a huge pool of people in this country of small businesses.
It includes not just taxi drivers, restaurant owners and electricians, but engineers, architects, lawyers and doctors.
The cheating is often quite bold.
When tax authorities recently surveyed the returns of 150 doctors with offices in the trendy Athens neighborhood of Kolonaki, where Prada and Chanel stores can be found,
more than half had claimed an income of less than $40,000.
Thirty-four of them claimed less than $13,300, a figure that exempted them from paying any taxes at all.
Such incomes defy belief, said Ilias Plaskovitis, the general secretary of the Finance Ministry, who has been in charge of revamping the country’s tax laws.
“You need more than that to pay your rent in that neighborhood,” he said.
He said there were only a few thousand citizens in this country of 11 million who last year declared an income of more than $132,000. Yet signs of wealth abound.
“There are many people with a house, with a cottage in the country, with two cars and maybe a small boat who claim they are earning 12,000 euros a year,” Mr. Plaskovitis said, which is about $15,900.
“You cannot heat this house or buy the gas for the car with that kind of income.”
The Greek government has set a goal for itself of collecting at least $1.6 billion more than last year — a modest goal, Mr. Plaskovitis believes.
But European Union officials were so skeptical, Mr. Plaskovitis said, they would not even allow the figure to be included in the budget forecast used in negotiations over the bailout package.
“They said, ‘Yes, yes, we have heard that before, but it never happens,’ ” he said.
Over the past decade, Greece actually lost ground in collecting taxes, even as the economy was booming.
A 2008 European Union report on Greece tax shortfalls found that between 2000 and 2007, the country’s average growth in nominal gross domestic product was 8.25 percent.
Its taxes grew at just 7 percent.
