The Greek Ministry of Finance is developing a bill aimed at the fight against self-employed people who systematically declare low annual incomes.
Minister Kostis Hatzidakis reportedly plans to introduce legislation to cabinet next week to curb tax evasion.
In a conversation with reporters, sources in the Ministry of Finance said that the changes will affect the taxation system for self-employed people, and not the tax rates that will remain unchanged.
Half a million self-employed workers (just under 70%) reported incomes of up to €10,000 a year, less than the minimum wage, according to an analysis of 2022 income returns by the Independent Revenue Authority AADE.
This means many employers are declaring less income than the people they employ, the sources said.
Only 4.3% declare an income of more than 40,000 euros per year.
The reason is banal, in Greece income tax tax is calculated at a progressive rate: so, if your income is up to 10 thousand euros per year, you will have to pay 9%; tax for income from 10 to 20 thousand euros will be 22%; from 20 to 30 thousand euros – 28%; from 30 to 40 thousand euros – 36%; with income of 40 thousand euros and above you will have to pay a maximum rate of 44%.
Considering the price level in the country, as well as the fact that most entrepreneurs also pay VAT 24%, social insurance, and other indirect taxes, which ultimately amount to another 10%, declaring high incomes is quite a risky business. Your income simply may not be enough to pay taxes.
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