On the way to the new taxation system, several details have been given to the press in order to do the usual of the last three bailout years: scare the people, test reactions and finally present the ‘worse’ as less bad than the ‘worst’. I mean, I hope it will work like that, because the new regulations are really out of this earth-world. How can Greece claim to combat tax evasion by pushing people to evade taxes? Will self-employed and freelancers issue receipts if they will cash just a bowl of peanuts out of two 500-euro banknotes?
According to daily Kathimerini:
1) Self-employed and businesses will be obliged to pay in advance 30% of the tax of the previous year in January, July and October. That it the tax office will collect 90% of the tax in advance -based on taxation of previous year – independently of the actual revenues of business and self-employed in the running year.
Currently down-payment of tax is at 55%.
Exceptions are considered in case the running revenues (and consequently tax payment) are lower than 20%. But then the tax payer has to prove this.
Collecting outer-space tax based on taxes of previous years, will certainly enable the Greek Finance Ministry to present nice balance sheets to the Troika lenders.
2) Each payment for freelance work will be taxed with 42% independently of the total annual income.
Example: one web designer receives in March 1,000 euro for delivered work and issues a receipt 1000 euro (23% Value Added Tax included).
After tax, V.A.T. and social insurance his profit could look like that:
Payment € 1,000 – €230 (23% Value Added Tax) = € 770 – €323 tax = € 447 – €200 social insurance at least = Profit € 247 euro!
Hopefully, he works from home and does not need to pay any rent or other stuff like that.
3) Compensation paid out to fired employee will be taxed from the very first euro. Currently compensation up to 60,000 euro is tax free.
Most probably this measure will affect the public sector as the private sector has fired all employees that could be potentially fired. Public servants lay-offs are due, and therefore the Greek finance ministry will cash back money the state will pay to fired public servants.
All these nice tax measures in times where recession prevails, unemployment is at 27% and the members of the parliamentary committee investigating the Lagarde List with 2,200 potential big scale tax evaders are verbally shooting at each other without having invited even one of these 2,200 bank account holders to give explanation about the source of money.
NOTE: while these taxation scenarios are in circulation since last week, the Greek Finance Ministry dismissed them on Thursday afternoon as “absolutely untrue”. However the FinMin refrained from disclosing what is true…
PS Is this the way development, growth and economic recovery will come to Greece? Yes. At the very end, Greece will be really competitive with employees and free-lancers earning no more than 400 euro per month. I wonder when the pensions will be ‘slaughtered’ down to this income levels as well. But here there is a small problem: they cannot ruin public servants still getting pensions of more than 2,000 euro and devoted voters, can they?