Tax evasion in Greece – Facts and Myths

Much is made of the meme “sure if the Greeks only paid their taxes…” . The argument, such as it is, elides into the “sure theyre all crooks” and “they should never have been in the EU”. It tips over into racism easily. So what is the case?

With thanks to @alea, some figures.

In total the Greek Revenue are owed €76b as of end 2013 tax due. That, by the way, is an estimate. Its not a tablet of stone. They estimate that 3670000 people and 447000 companies owe some tax. And yes, people should pay tax. But….

3,174,000 people and  357447 companies owe up to €3000. Thats €10.5b. 2000 people and 4000 companies owe over €1m each.  Thats a minimum of €6b.   494000 people and 85553 companies owe between €3000 and €1m. They cant owe much more than 50k or the math doesnt work. . So, tax evasion is both endemic and concentrated.

Put another way – 87% of the tax is owed by 15% of the defaulters, with a minimum of 8% owed by 0.15% of the defaulters. I strongly suspect three things.

It is, I submit, easier to get 6000 to pony up than 3.5m to do so. And in doing so the message goes out. Greece needs some Lester Piggots.

Here are some surmises…

a) these 6000 top defaulters are well connected to the greek establishment. And that establishment is well connected to the elites in other countries. Remember that when reading newspapers or watching sockpuppers on blogs.

b) many of the 4000 companies are state owned or connected thus any tax collection would, in fiscal terms, be a wash

c) none of the 2000 top persons and very few of the 494k middle defaulters are Syriza voters and supporters. Remember, about the only thing that Greece and Germany agree on is that the Greek tax system is in need of reform and that Syriza are mandated to do some serious housecleaning.

Update: as noted on twitter, this is also of course presuming that these people could pay tax. Many of the companies and individuals owing tax assessed are defunct or bankrupt.

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5 thoughts on “Tax evasion in Greece – Facts and Myths

  1. Pingback: Breaking Gold News and Commentary (20 February 2015) - GoldCore News

  2. Breda Cahill

    Know what I can’t understand? Why our useless, dis-connected Irish Government are not supporting Greece in their efforts to get a debt write-down and re-build their country….it is my opinion that our country will never be fully functional again in all areas without a debt write-down…it is not just water tax any more…we need to fight for a right down of our debt to the Eurozone and IMF…without which the vast majority of our people will never enjoy a decent quality of life in this little country which has so much potential but is being strangled by austerity for a crime the people of Ireland are being made to pay for…why can’t we all fight against this injustice?
    Breda Cahill, Wexford.

    Reply
  3. geek2cv

    But is tax evasion the same as tax owed? I always thought tax evasion is “let’s do some crooked scheme to avoid paying taxes”, while tax owed is what would appear in those stats mentioned here “these people got their tax bill, but they didn’t pay it.”
    Some of the measures SYRIZA wants to implement look good for a chance to get paid some of the money that people owe on their tax bills, e.g. lowering the minimum amounts for people and companies to pay in installments.

    Reply
  4. Pingback: If only the Greeks paid their taxes | International Development and International Organizations

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