And Still The Greeks Avoid Taxes!

It would seem some people never learn, for even when they end up to their necks in the mire through their own stupidity and greed, and with their country on the verge of total bankruptcy, they continue to make the same mistakes. I am of course referring to the Greek habit of not paying their taxes, which is the main cause for the massive debt they are now suffering.

In my 23/10/2011 post The Shocking Truth Behind the Greek Debt, I explained why the Greek people ended up in a crisis that has shaken the very foundations of Europe, and yet the latest news is that nothing has changed.

She Tells It As It Is!

It bugs me somewhat to think that the Greek people were very angry at the remark made by IMF head Christine Lagarde when she said the Greeks were avoiding paying taxes. Indignation was rife and she received many angry complaints, but the simple truth is – she spoke the truth!

For decades, very few people in Greek society have paid the level of taxes they should, in fact the rich have not paid any at all, and the latest estimate is that the country will run out of money completely by the end of July!

An Economy Based On Deceit

Government officials are now scrambling for ideas in an effort to collect taxes from people, but some just haven’t got the money, and many businesses are using ‘cash only’ methods in an effort to forestall paying taxes on their income. Despite the recent bailout of 130 billion, the government still faces a shortfall of 1.7 billion because tax revenue and other sources of potential income cannot be collected.  Nikos Maitos, an official in Greece’s financial crimes investigation unit said, “One repercussion of the crisis is that people are harder to find, and when you do find them, they don’t have money.” Harry Theoharis, a senior official in the Greek Finance Ministry is quoted as saying, “You can’t flog a dead horse”.

The government has stated that it is owed a total of €45 billion in back taxes and the outlook is that only a fraction of that will ever be recovered.

Paperwork Chaos

According to reports, the Greek government has begun enforcing a 1995 law that allows tax inspectors access to the bank accounts of suspected tax evaders. The banks however have so far obstructed 5,000 requests for information since 2010, and are delaying the hand-over of other documents by up to 10 months, and then dumping such a huge pile onto the tax department that trying to get the necessary information is next to impossible. So, you see, considering the whole European financial mess started with the banks in  2008, they too have not learnt any lessons in Greece.

To add to the country’s woes, the rich are moving their capital out of the country as fast as they can, for they too are ducking paying tax on the largest proportion of their wealth, which is a bit sick considering before the current crisis they never paid any at all! 

The Underground ‘Honesty’ Barrier

Among the people there is anger that salaries have been cut by as much as 50% due to the austerity measures, but if you read my last post on the subject, you will realise that the salaries earned before the crisis were out of all proportion with the rest of the world. Cleaners employed by the Greek Rail Company earning €60,000 a year, and on top of that, no-one buys a subway ticket in Athens because there are no controls, meaning millions travel for free every month. 

Any country run on these lines is doomed to irrevocable failure, and from all accounts, the crunch is going to come soon. The sad thing is, when it does come it will likely drag the rest of the continent down with it, and eventually we will all suffer. Whether the Euro will survive this is without doubt questionable. Greed will eventually be the undoing of man!

Roy. 

For those interested, the following link will take you to my previous post on this subject:

https://floroy1942.wordpress.com/2011/10/23/the-shocking-truth-behind-the-greek-debt/

 

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