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Greece tax receipts still falling short of key targets to cut debt
Source: Agencies |
December 18, 2012, Tuesday
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GREEK tax collection is still falling short of key targets that need to be met to cut the government's staggering debt pile, the European Union warned yesterday.
An European Union task force helping Greece overcome the financial crisis that brought it to the brink of bankruptcy said Athens still has trouble dealing with old, outstanding tax claims. With two weeks to go in 2012, it was still about a billion euros behind the EU target of recovering 2 billion euros (US$2.6 billion).
In a report it said Greece made only 88 audits of large taxpayers, well short of a 2012 target of 300, and 467 of "high-wealth individuals," below a 1,300 target.
Overall, though, EU Vice President Olli Rehn said Greece was tackling problems "with determination and resolve."
Greece's partners in the 17-country eurozone agreed only last week to hand over the next disbursement of the country's bailout loans, which will prevent it from going bankrupt and triggering more turmoil in financial markets.
The cash-strapped country will get a total of 49.1 billion euros (US$64 billion) between now and March, with 34.3 billion euros due in the coming days.
In return for the money that will see Greece through the winter months, the country had to commit to further austerity measures, including more spending cuts and tax increases.
And it needs to better enforce rules it already has set to get the public finances back on track. The EU set up a task force of specialists to guide Greece through that process and it produces quarterly reports to chart progress.
Taxation is a particularly tough issue to deal with. "The Greek tax administration is falling short of targets and is not well placed to meet end-2012 benchmarks," the report said.
The group did insist in the report that the new government of conservative Prime Minister Antonis Samaras was strongly committed to an overall reform of the tax system.
Last week, the Greek government proposed legislation for a simplified tax system by which people earning more than 42,000 euros per year will now be taxed at a new top rate of 42 percent.
Under the new guidelines, the 42 percent top tax rate and earnings threshold replaces the previous level of 45 percent for incomes above 100,000 euros. There are currently eight tax bands ranging from 18 percent to 45 percent.
An European Union task force helping Greece overcome the financial crisis that brought it to the brink of bankruptcy said Athens still has trouble dealing with old, outstanding tax claims. With two weeks to go in 2012, it was still about a billion euros behind the EU target of recovering 2 billion euros (US$2.6 billion).
In a report it said Greece made only 88 audits of large taxpayers, well short of a 2012 target of 300, and 467 of "high-wealth individuals," below a 1,300 target.
Overall, though, EU Vice President Olli Rehn said Greece was tackling problems "with determination and resolve."
Greece's partners in the 17-country eurozone agreed only last week to hand over the next disbursement of the country's bailout loans, which will prevent it from going bankrupt and triggering more turmoil in financial markets.
The cash-strapped country will get a total of 49.1 billion euros (US$64 billion) between now and March, with 34.3 billion euros due in the coming days.
In return for the money that will see Greece through the winter months, the country had to commit to further austerity measures, including more spending cuts and tax increases.
And it needs to better enforce rules it already has set to get the public finances back on track. The EU set up a task force of specialists to guide Greece through that process and it produces quarterly reports to chart progress.
Taxation is a particularly tough issue to deal with. "The Greek tax administration is falling short of targets and is not well placed to meet end-2012 benchmarks," the report said.
The group did insist in the report that the new government of conservative Prime Minister Antonis Samaras was strongly committed to an overall reform of the tax system.
Last week, the Greek government proposed legislation for a simplified tax system by which people earning more than 42,000 euros per year will now be taxed at a new top rate of 42 percent.
Under the new guidelines, the 42 percent top tax rate and earnings threshold replaces the previous level of 45 percent for incomes above 100,000 euros. There are currently eight tax bands ranging from 18 percent to 45 percent.
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