Sticky Business — 3 Comments

  1. A couple of years back, when the Greeks suddenly woke up to the fact that their economy was down the pan, along the sewer and out into the Aegean Sea, the German MSM did some rather good, well informed, documentary pieces on ‘How The Hell Did We, The Germans, Let This Happen?!’ . NB it was assumed by the, then, very Pro-Greek German MSM that it was an oversight on Germany’s part. This was before the Greeks lost even the simpering sympathy of the German MSM.

    Anyways the documentaries and news pieces very quickly came to the conclusion that actually the Greek economy wasn’t in bad shape, infact Greece could be up there with the winners BUT for a national neurosis about not paying taxes…and no I don’t mean the ‘fat cats’ but precisely those little businesses like that Crepe shop. It all got rather technical (German, remember?) but the long and short of it was that if the Greeks didn’t get serious about collecting taxes then all hope was lost- EU handouts and bail outs only dragging out the inevitable and that what really needed to change was the Greek mentality- and Germans enjoy paying taxes as much as the next guy…indeed the first thing anyone in German making serious money does is open a Swiss Bank Account …or rather did (Swiss Banks now not being as reticent as before about sharing details with the German Tax Office).

  2. Yes, it’s true that the Greeks view tax evasion as a national duty. The situation was further exacerbated by the fact that the tax collectors were complicit in that tax evasion, as long as a suitable ‘donation’ was forthcoming. The ‘fakilo’ (brown envelope) was an integral part of doing a tax return. It was only in recent years that the government started questioning how the tax collectors, on a standard civil service salary, were able to afford luxury villas and Mercedes Benz cars.

    The problem now is that they’ve gone from one extreme to the other, and the situation as it stands is untenable. Tax is only the half of it; one of the biggest expenses is social security payments, which are horrendously high. There are three systems of social security: IKA, which is for salaried people, the costs of which are shared by employer and employee; TEVE, which is for self-employed people; and OGA, which is for the agricultural sector. Where TEVE is concerned, it can be crippling, as they levy a fixed (and very high) sum which must be paid, on threat of prosecution. It matters not if your business tends to be seasonal – you must pay every month regardless; and if you are a self-employed plumber, for instance, and work is very thin on the ground, your TEVE payments can easily exceed your earnings. A couple of friends with small businesses have said to me that if they complied with all the demands for payment, they’d be running at a loss. The Greek government needs to find a compromise that doesn’t strangle enterprise at birth and that doesn’t make running a business a pointless exercise. The heavy-handed approach that they are currently employing will only serve to drive more people out of business, which does nobody any good.

  3. “The Greek government needs to find a compromise that doesn’t strangle enterprise at birth and that doesn’t make running a business a pointless exercise.”

    Good luck to them and if they find an answer maybe they might share it with the UK cos even now before Brexshite tax is taxing and who, besides the smokers and drivers, is going to be paying for PMT.May’s Post EU Paradise?