Taxes: "To pay or not to pay, that is the question"

The population pays for expensive fuel, because tax evasion, both small and large, in Greece (as well as in many other countries of the world) is common. This, unfortunately, is the simple and bitter truth about paying taxes, says Greek publicist Adonis Karakoussis.

Taxes have never been popular. On the contrary, they have always aroused the wrath of the citizens, and sometimes served as the ground, or rather, the pretext for uprisings, even national revolutions.

From the ancient Athenian tithe and the Ottoman invasion to the “tea tax” that sparked the Revolutionary War and still haunts the United States, all types of taxes have been written in black in the collective memory of human society.

In the recent history of Greece, especially after the but never officially recognized bankruptcy and overuse of taxes, they have been shown as the ultimate evil. Over the years, memorandums have become the dominant instrument of fiscal policy.

In the summer of 2015, after the unsuccessful attempt by the first government of Mr. Tsipras to remove onerous bankruptcy conditions, all sorts of taxes prevailed and increased.

The price of the delusions and illusions of the then political leadership was precisely the introduction of unbearable taxes. Real estate was overburdened by the giant ENFIA, basic necessities were subject to double the previous 24% VAT, and for each employee the state received up to 50% of taxes on his wages – by maintaining high income tax rates and introducing additional emergency contribution on all income, even those received from disabled pensioners.

In the next phase of the corresponding budgetary balance, the New Democracy government began to slowly reduce the burden of taxes, mainly on income, without satisfying, however, the demands of citizens. With the onset of the coronavirus pandemic, and now the combined geopolitical and energy crisis, growing fiscal pressures have prevented an accelerated tax cut. Like the war in Ukraine, the ongoing explosion of Turkish revisionism has left no room for accelerated tax cuts.

In this extraordinary environment of energy and geopolitical instability, the government has prioritized control of electricity prices, support through subsidies to households and businesses, and a significant increase in military spending due to the Turkish military threat.

Thus, it deliberately left indirect taxes, especially on fuel, unchanged. The reason is that fuel tax revenues are almost irreplaceable due to the structural problems of tax policy. And today only they are the most stable source of replenishment of the budget.

Despite technological progress and gradual electronic transactions prevailing, informal incomes remain predominant in our country. Every year, billions of taxes are lost due to tax evasion. Almost 25% of the national income remains in the shadow.

A possible reduction in VAT (24%) on fuel, which is applied on the basis of high prices and excise tax, will deprive the state treasury of significant revenues that the Ministry of Finance will not be able to replace from lost revenues.

In fact, the general public pays for expensive fuel because the state cannot collect enough taxes from both small and large taxpayers. This, unfortunately, is the simple, bitter truth of tax choice.

***

From the editor.
Despite the fact that the material slightly smacks of an order from those in power, the author makes quite reasonable remarks, pointing out the low fiscal discipline of the inhabitants of Greece. And what do you think?

Source link