Surprised? 50% of self-employed do not pay social security contributions to OAEE

Everyone who has worked in Greece as self-employed or freelancer has crawled through the dark corridors of OAEE and has experienced the nightmare alive in the maze-like construction, a mixture of Minotaur labyrinth and Monopoly. Especially the small and medium-size entrepreneurs found themselves often in the position to be not able to pay their contributions of several hundred euro per month.  The effect was immense: they and their families were kicked out form the medical and pharmaceutical care, the debts were piling up. Even if the entrepreneurs wanted to close his business that was not possible due to OAEE debts.

Since the beginning of 2014 the situation has become even worse: not only the entrepreneurs are taxed from the very first euro they put in their cash register, they are now under threat to have their assets seized.

A taxpayer received beginning of the month a notice from the tax office informing him that the Finance Ministry will seize his home due to a debt of  €6.24 (yes. six euro and 24 cents!). According to the law, seizure is possible for debts over 500 euro.

But seizure due to debts does not refer only to real estates or cars. Ιf debtors have facilities with hot euros landing in the cash register and debts to the tax office, they can see the turnover of the day vanish within minutes.

Yesterday, Sunday, members of Financial Crime Units (SDOEE) accompanied police entered one of the beach facilities at the Athens sea coast. The facility was renting sun loungers and selling drinks and sandwiches. The SDOEE/Police team stayed and at the end they seized the turnover  -between 10,000 and 15,000 euro – from the cash register. The beach bar owner had debts to the tax office.

The law for such seizure actions is in force since 6 months.

 

As the economic crisis continues to push on their knees thousands of self-employed and freelances, so is the OAEE deficit growing.

According to data from Labor Institute, it is estimated that the unpaid contributions to OAEE have reached €7.4 billion as 50% of OAEE members are unable to pay contributions to the Fund, have not medical care and are threatened with seizure of assets.

Since a couple of months, some 370,000 self-employed and freelancers have stopped paying their contributions, so that the black hole in OAEE stands at €720 million for 2014 only.

Indicative for the tragic economical situation of small entrepreneurs is the fact that 80% of the unpaid contributions come from small debtors owing to OAEE up to €10,000. (full article in Greek)

That could be unpaid contributions for 28 months should the entrepreneur have to pay €350 per month.

Of course, entrepreneurs have to possibility to proceed to settlement and pay their debts in installments plus the running contributions. A real joke in Greece of ongoing economic crisis…. On the other hand if they fail to pay the installments, the settlement turns invalid.

Now the Labor Institute of Federation of Private Sector unions (GSEE) and the Federation of Greek Commerce have proposed that

1. the insured at OAEE have the option to choose category of insurance and contributions

2. the debts ‘freeze’ and can be later ‘bought’.

But the Finance Ministry does not seem to have an open ear to the proposals.

At the every end, Greece is under pressure by its lenders to collect as much money as soon as possible, even if the OAEE and every pension fund will go bankrupt after a coupler of years.

Apart form the fact that social security contributions are not paid in time, Greece’s insurance funds lost millions of euros during the “haircut” of March 2012.