From property tax to tax evasion

From property tax to tax evasion

Athens, March 28, 2016/Independent Balkan News Agency

By Spiros Sideris

One of the ills of the Greek public administration is the failure to create a system of tax collection and the successful tackling of tax evasion. What all governments to date managed to do was draft tax bills, but without an impact in state revenue.

Tax evasion is not a Greek privilege. In all states evasion and corruption are among the biggest problems governments are faced with. But what many governments have accomplished is to create tax awareness. Something completely missing from the Greeks.

The lack of tax consciousness of the Greeks has its roots in the Ottoman Empire and the poll tax or “haratsi”, levied on every citizen of the Empire over 12 years as compensation for being alive. It is no coincidence that the titles of the media, in each tax increase speak of a “haratsi” – attributing this characterization even to fair taxes – undesirable for most, since once it was linked to servitude.

The equation of taxation with servitude was established after the Liberation in the logic of modern Greeks. Any discussion for taxation and civic participation to the needs of the state fell on deaf ears.

The truth is that the payment of tax is associated mostly with the reciprocity on the part of the state to citizens. Something that was not the case in the newly established state, since corruption was everywhere, while governments imposed by the Great Powers contributed to this maximally.

The rapid territorial growth of the New Greek state did not contribute to the creation and recording of both the public and private property, leaving gaps in taxation. The refugee flow of Greeks from Asia Minor and Pontos, created even greater problems in a state that did not have the structures of a tax database, since it was constantly changing.

Of course neither the political parties contributed to creating the conditions for a fair taxation, as the transaction of citizens with auditing mechanisms was an field of political exploitation. Also, the complexity in taxation, contributed even more to corruption and fraud.

Under these conditions, it is logical for tax evasion to boom and a subsequent weakness of the state in the performance of tax justice and tax collection. Beyond this, however, it should be note that the black money that exists keeps the market going, despite six years of extreme austerity. If there was no flow of black money, the Greek economy would have collapsed long ago.

Unfortunately, just with repressive means one can not create a tax consciousness. The government has been very late in this direction, following in the steps of its predecessors, simply obeying the lenders’ commands for even more money through taxation. Something as shown does not bring results.

Communication-wise the previous ND – PASOK government lost many votes for the mismanagement of ENFIA, and if the SYRIZA ANEL government wants to avoid the same fate, it should communicate both its options and the tax consequence of citizens, which will now have reciprocal value. Otherwise the game will be lost, even before it begins.