Tax evasion becomes extreme sport in Greece

May 21, 2010

By Dina Kyriakidou

GREECE-TOURISM/In Greece, hiding a little from the taxman is considered good sport, so the government, struggling with a debt crisis is shaking international markets, is firing every weapon in its arsenal to crack down on rampant tax evasion.

A snapshot of the Greek capital’s northern suburbs, where the Athenian nouveau riche have built big swimming pools as status symbols, revealed about half of them had not been declared to tax authorities.

View Larger MapSuch luxuries, along with big cars and yachts, are considered “objective criteria” of high income and authorities tax accordingly regardless of declared income. But tax dodgers quickly fought back. On the Trelo Kouneli blog, visitors exchanged advice on how to dodge the tax man. They included “Put an army net over it”, “Paint the tiles green so it looks like grass” and “Hack Google maps”.

The Socialist government faces an admittedly tough task. To climb out of the debt crisis, it must impose tough belt-tightening measures on a public that has seen politicians and businessmen get rich off the state for decades. It was no wonder that Prime Minister George Papandreou sacked his tourism minister this week after press
revelations her singer husband owed 5.5 million euros in taxes and penalties. Blogs went wild with calls to stop paying taxes unless authorities stepped in.

Opinion polls and street violence indicate people will resist austerity unless social justice is done, until blatant tax evaders and those involved in a long string of scandals are thrown in jail.

Given the widespread impression that the big fish never get caught, many Greeks don’t think it’s unethical to hide a little income from a state which gives very little back. At most state hospitals and other public services, citizens regularly get unsmiling, slow service and bureaucracy for their money. Most Greeks pay a “tip”, also known as “fast-stamp” and “little envelope” to get things done.

Doctors, plumbers and electricians are notorious for not giving receipts. In an recent crackdown, the government published this month the names of 69 tax-cheating doctors in the upscale Kolonaki area, saying they face fines and prosecution.

To propel tax payers to demand receipts, the finance ministry has given tax incentives to those submitting stacks of the little pieces of paper to authorities.

The ministry says the measure is already paying off, boosting central government revenues in the first months of the year. But perhaps not as much as it could. Ingenious Greeks may have found a way around that as well. Those who don’t need a big pile, offer them to others and some shops collect those left behind by clients to give as a bonus to regular customers.
“Here’s some extra receipts,” my regular hair dresser told me after a haircut last week, extending a handful. “I put them together for you so it looks like you come here once a week.”

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