Greek Banks Want Cashless Society, Tax On Cash Withdrawals

ATHENS – In a bold bid to end tax evasion, Greek banks have proposed taxing cash withdrawals and requiring use of debit and credit cards for all transaction.

Bank officials said cash is easily funneled into the underground economy, costing the state an estimated loss of 15 billion euros ($15.88 billion) a year, which would stop if there were no cash.

The banks said imposing a tax on withdrawals would drastically reduce transactions in cash and therefore the illegal economy as well, Kathimerini reported.

Lenders are also asking for the compulsory use of cards or other online means for all transactions concerning professions rife with tax cheats or where cash is used as payment, such as mechanics, doctors and others who provide services without giving receipts.

Credit and debit cards as well as the new technologies that allow for contactless transactions, such as cell phone apps, should be possible to use even for the smallest transactions, from the purchase of a newspaper to buying a bus ticket, banks argue.

The illegal economy in Greece is estimated at some 40 billion euros every year, with state coffers losing out on tax revenues of around 15 billion euros per annum.