Greek Tax Authorities Clamp Down on Mykonos Tax Cheats – Again

(FILE - Photo by EUROKINISSI/Christos Bonis).

ATHENS – One of Mykonos’ most popular and expensive entertainment venues, Nammos, fined previously for cheating on taxes, quickly paid up 4 million euros ($4.63 million) in undeclared taxes but was allowed to keep operating anyway despite an alleged crackdown on the island.

Inspectors fanned out to check on restaurants and other establishments not giving receipts and not declaring taxes with the cheating phenomenon rolling on and fines assessed that are far less than the monies usually brought in by evading payments to the state and no reported closures.

Almost sixty officials were involved in the four-day operation codenamed Trident because of the three-pronged focus of its inspections, commonly done in the summer tourism months but failing to stop the cheating of restaurants, taverns, hotels, water sports operators, beach clubs, nightclub and tour operators who are allowed to stay in business despite repeated violations.

The operation was launched by the Independent Authority for Public Revenue (IAPR) with the assistance of the financial police and involved having inspectors auditing a business for a whole day and then comparing the takings to those of previous days, the paper said.

If large discrepancies are found, fines are imposed but some businesses then go right back to cheating because it’s profitable even if they are assessed penalties.

Inspectors were also said to be looking for tampered cash registers, where rely on software to falsify electronic records for the purpose of tax evasion but aren’t shut down even then. They are also looking for businesses who owe debts to the state who could have daily takings confiscated Trident” inspectors detected a tampered sales register in Ornos and also seized the takings at a well-known Italian restaurant in lieu of tax debts, it was reported.

The most egregious example was Nammos, located at Psaros beach who paid up the 4 million euros it owed although only last September it was found to have been a major tax cheat and only suspended but not shut down nor confiscated by the state and now has cheated again.

The club was said to sell champagne at 1,000 euros ($1190) a bottle has been suspended, reports indicated that widespread tax evasion on the island growing notorious for high living by foreign high rollers is continuing.

The license for the club Nammos, featured in a piece by David Patrikarakos earlier in Politico, describing the island as a hedonism heaven, was briefly taken away, the business newspaper Naftemporiki said, because it was charged with exploiting a public beach.

Inspectors said the club’s management built a stage and metal-wood staircase to host a concert, something it said violated the lease contract’s terms.

Nammos was targeted by inspectors over charges the club hosts sold-out concerts by big shot entertainers but doesn’t fully report the income that is taken in, instead claiming far lower amounts in a bid to avoid taxes. Tables were said to cost tens of thousands of euros, happily forked over by the wealthy.

On Nammos Beach renting a chaise lounge will cost 60 euros ($72) – more than 10 times the rate even on Santorini, which is even more famous and more crowded.

A pretty good, but not great hotel, will cost 1000 euros ($1200) a night, a price which doesn’t make the bling-blingers blink an eye, because they would miss the chance to see today’s celebrities such as Olympic sprint gold medalist Usain Bolt, or Kim Kardashian, who got rich and famous for nothing really, except showing her talents on a sex tape.

Luxury loungers that are bed-sized take over the beach: it’s not clear whether, like many Greek public beaches it’s just been usurped and the article said the main bar last year sold 35,000 bottles of champagne at 1,000 euros each – or 35,000,000 euros, some $42.06 million, enough to pop anyone’s cork.

Patrikarakos said he went there with a relative who told him many bars and restaurants were built unlawfully, a common practice in Greece where nothing is done about it. “All they do,” he says “is pay a fine each week — say between €1,000-€3,000, which is nothing compared to the profits they are raking in.”

Kathimerini said stepped-up checks by tax inspectors on the island last summer brought in big revenues but failed to halt the phenomenon because fines are far less than businesses can make in only a few hours or less than a day of high-rates.

The paper said one bar paid one million euros ($1.19 million) in Value Added Taxes (VAT) – an indicator of how much money was rolling in – with the amount more than twice what it paid last year.

In April, 2016, Myconos Mayor Konstantinos Koukas asked the General Secretary of Public Property to ban the use of protected beaches for private gain as happens along Athens’ coast with impunity where people are charged to use beaches taken over by private companies who are allowed to keep operating.
In 2016, some 44 fines for illegal exploitation were imposed on beach side businesses on Myconos, totaling 1 59 million euros ($1.89 million) and a fine of 800,000 euros ($952,680) was imposed on a beachside business for the illegal construction of four buildings without a permit, the paper said.