It doesn’t add up, but Bank of Greece Governor Yannis Stournaras said the numbers about unstoppable tax evasion don’t lie and show that Greeks spend 40 billion euros ($42.19 billion) more than they report in income.
He told the 19th annual Tax Forum of the American-Hellenic Chamber of Commerce the gap between reported income and spending showed the real and dramatic extent of tax cheating no government has been able to stymie.
The total declared income in 2021 was some 84 billion euros ($88.62 billion,) but 79 percent of them came from salaried workers who have taxes taken out of their checks and whose income can be verified and cross-checked.
They pay a disproportionately high amount of taxes in Greece, where everyone from professionals such as doctors and lawyers to those in services like plumbers and auto mechanics, small shops, cafes and small businesses pay little or none.
Data showed that about 70 percent of taxpayers engaged in a form of business activity, or who are self-employed, declare annual incomes less than 10,000 ($10,550) that is barely above the minimum wage for unskilled workers.
Some 37 percent of taxpayers in Greece say they make less than 5,000 euros ($5,275.) That’s a threshold allowing them not to pay any taxes and essentially declaring themselves to be in poverty.
Many of Greece’s rich hide their wealth in foreign banks, especially Switzerland, and Greek governments have been unable to get the information that’s kept secret and can’t determine how much in taxes is really lost.
Stournaras said the phenomenon costs almost 21 percent of the annual economic output, or some 42.474 billion euros ($45.13 billion) and deprives the government of monies for public services.
Stournaras – a former finance minister for a previous New Democracy government who was unable to cut into the problem – said the current Conservative administration has to find a way to do it.