Greece is taking a firm stance against rampant tax evasion with sweeping reforms targeting professionals and businesses notorious for reporting suspiciously low profits.
The Ministry of Finance and the Independent Authority for Public Revenue (AADE) are set to overhaul the taxation system in a bid to tackle one of the nation's most pressing financial concerns.
Recent data has highlighted glaring discrepancies in reported income and profits, with businesses seemingly utilizing inflated expense claims to minimize taxable income.
To counteract this, starting next year, all business expenses must be digitally recorded via the myDATA system. Any expense not accounted for in this system will not be recognized for tax purposes. The aim is to reduce discrepancies, limiting allowable deviations to just 5% after an initial transitional year.
In another significant move, tax returns for professionals and businesses will not only be pre-filled but also "locked," eliminating the possibility of manual adjustments. This necessitates careful technical preparations to ensure a seamless transition.
The need for such reforms is evident from the surprisingly low average incomes reported by various professions. This, coupled with inflated expense claims, suggests significant underreporting of earnings. The situation is further illustrated by cases like bar owners, who reported low net incomes despite high gross earnings.
Officials emphasize that unless these "loopholes" are addressed, the current system will remain in place, albeit with necessary adjustments. The Greek government is determined to establish a more transparent and equitable tax system that effectively combats evasion and increases public revenues.
By George Pappous