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Economy

Greece Losing 5.35 Billion Euros on Value Added Tax Evasion

ATHENS – It’s unstoppable but tax cheating in Greece is now so prolific that it’s costing the country some 5.35 billion euros ($5.66 billion) annually, second highest in the European Union.

The amount is equivalent, said Kathimerin in a report, to two years’ worth of Single Property Tax (ENFIA) takings and will be even more costly as the New Democracy government, with elections coming in 2023, is reducing that rate.

The European Commission is calling on the bloc’s members to increase their efforts to contain VAT evasion, which amounts to more than 134 billion euros ($141.7 billion) across the bloc every year but no one has any answers yet.

The losses in Greece amount to 25.8 percent of potential VAT takings which means one in every four euro is lost during a time when the government poured billions into COVID-19 pandemic aid and energy subsidies for households.

The EU said member states should do better with risk analysis, automatic procedures and information exchange between them and for upgrading online systems and technologies to find the cheats.

The report said that despite its reputation for rampant tax evasion, progress has been made in Greece in some areas, including increasing checks on cross-border transactions within the EU, where the greatest amount of fraud is recorded.

From 2000-19 the problem cost Greece an estimated 120 billion euros ($126.89 billion) in monies that could have gone to help society and is more than one-third the 326 billion euros ($344.73 billion) in three international bailouts received.

Collecting the monies also would have led to reducing other taxes put mostly on workers, pensioners and the poor who were also the main targets of harsh austerity measures during the bailouts.

The EU also recommended cross-checking VAT registration data with third sources, enhanced investigations,  improvement of cross-border tax authorities’ cooperation, systematic inspections based on risk indexes, and creation or maintenance of a register of taxpayers active in online commerce.

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