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20th Aug 2022

EU experts to focus on tax-evading Greeks

Tax evasion remains among the greatest challenges for experts tasked with helping Greece with administrative reform.

A second assessment report by a European Commission team meant to assist Athens with internal change shows that while Greece far exceeded its 2011 target for tax collection - hauling in €946 million in tax arrears instead of the €400 million target - huge work remains to change a culture of tax evasion, particularly among the very wealthy.

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  • Greece is undergoing profound and painful change in return for bail-out money (Photo: John D. Carnessiotis, Athens, Greece)

‏"Outstanding collectible tax arrears are estimated to amount to €8 billion," says the report published on Thursday (15 March). It notes that tax evasion by high wealth individuals and large corporate taxpayers "will be the focus of particular technical assistance in the coming months."

Experts from 12 member states are helping out. Much of the help comes in the form of passing on knowledge in specialised workshops. Greek officials have been advised by debt collection experts from Sweden and the Netherlands, and by French and Danish experts on taxing wealthy individuals. Germany alone has around 160 tax experts to draw on when it comes to Greece.

The European Commission is advising on offshore accounts - how to retrieve the "allegedly vast amounts" of Greek money channelled particularly to Switzerland.

Presenting the report, Horst Reichenbach, the head of the so-called taskforce for Greece, emphasized that that experts' presence in Greece should be seen as a "complete expression of EU solidarity."

But solidarity only goes so far. It requires reciprocal action, indicated Reichenbach. This implies actually implementing the austerity measures passed by the Greek parliament in order to secure the just-agreed second €130 billion bailout.

Asked about the planned further salary and minimum wage cuts, Reichenbach said "labour costs" need to be reduced for Greece to make itself more competitive but also to appease the countries bailing it out.

"Euro countries who are poorer in terms of income per head wonder to which degree they should contribute to the efforts to support Greece and one has to recognise there is also in their population a need to give explanations.

Therefore I think we need to be fair to Greece but we also need to be fair to countries who have gone through perhaps an even deeper transition than Greece," said the German official.

Meanwhile the to-do list in the assessment report is a reminder of the extent to which Greek society, culture and way of doing business is being changed through its massive debt crisis.

The taskforce team is providing expertise on everything from registering land in Greece - it is difficult to do the firesale of Greek assets that creditors want because no one is quite sure who owns what - to setting up e-prescriptions, cutting the cost of medicine, introducing performance assessment of ministry officials, fixing waste management and simplifying export procedures.

"A lot remains to be done," said Reichenbach, adding the details of the yet more intense on-the-ground monitoring that eurozone partners want to see in Greece are not yet finalised.

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