[mysticllama]

A CNN article from 2010 referenced 2008 government documents that said "6 in 10 Greeks don't pay income taxes" source: http://www.cnn.com/2010/WORLD/europe/12/31/greece.taxes/

I don't know what the rate of tax evasion is in other western countries, but I'm willing to wager the situation in Greece is dramatically worse.

I remember reading a NYT article from the same year that provided further insight:

Various studies, including one by the Federation of Greek Industries last year, have estimated that the government may be losing as much as $30 billion a year to tax evasion — a figure that would have gone a long way to solving its debt problems.

The cheating is often quite bold. When tax authorities recently surveyed the returns of 150 doctors with offices in the trendy Athens neighborhood of Kolonaki, where Prada and Chanel stores can be found, more than half had claimed an income of less than $40,000. Thirty-four of them claimed less than $13,300, a figure that exempted them from paying any taxes at all. source: http://www.nytimes.com/2010/05/02/world/europe/02evasion.htm...

I haven't seen more recent numbers, but it makes me wonder about citizens' culpability in the government's debt crisis.

Maybe I'm overestimating the role of taxation in this debt fiasco, but it does seem as if the attitude of a lot of Greek citizens needs to change, if it hasn't already.

[brianwawok]

Here is something that maybe I am not understanding.. but saying that 6/10 greeks pay no income tax does not tell us how much tax evasion there is, right?

From what I can google: http://www.taxpolicycenter.org/taxtopics/federal-taxes-house...

43% of Americans do not pay federal income tax (and some % of those get a net gain of federal income tax). Sure 60% is > 40%... but that could be due to a ratio of more people really poor, compared to more tax evasion.

(Not doubting Greece has a tax evasion problem, but 6/10 not paying taxes seems bad evidence).

[mysticllama]

saying that 6/10 greeks pay no income tax does not tell us how much tax evasion there is, right?

You're right, the 6 in 10 figure seems rather misleading. Those people shouldn't be characterized as tax evaders as I suggested. That said, it probably points to an issue of not enough tax contributors.

The numbers for America are interesting, I wouldn't have guessed the rates were that high.

Anyway, as far as tax evasion goes, I wonder how much a lack of enforcement allows well compensated workers to get away with claiming they're below the tax exempt mark.

[brianwawok]

I mean that is the trick right? You have a doctor making 100k claiming he makes 10k and paying no tax. I have seen individual stories of it, but is that really the common case? Or is it more like rich business owner making 300k claims he made 200k because of the cash heavy economy in Greece?

[vermontdevil]

And how many rich people pay their fair share of taxes in the US?

I think the issue is deeper than just not paying taxes. But that's just me.

[antman]

Fiscal austerity one form or another has been a decade long process in Greece. After that the employment ratio in Greek population is the third lowest in OECD countries [0]. This ofcourse is hidden in plain view since discussion is usually about the UNemployment ratio [1], which hides long term unemployed due to the economic downturn.

The Federation of Greek Industries is not a credible speaker and they had published that report to justify lowering their request to lower their taxes. It was affiliated with the right wing Government.

Kolonaki is a doctors area, old and young doctors try to set upo shop there. If half of them are young doctors 40000 is too much. The authorities that wanted to collect taxes figured that out and measured a minimal squarea area of the doctors office and location and imposed arbitrary fines. Same arbitrary taxes were imposed in most professions to show a long term ability to collect taxes, in collaboration with their foreign creditors, Of course it did not work out their creditors could hide the inefficiency of their program to chating Greeks. It also worked as a Trojan Horse in the Greek socity, when various groups where singled out in rotation as not having produced the taxes that were expeced of them. The troika and the Greek Government would probably be able to expose some of them, but it was apparent that it would be small sums that would expose the greater inablility of their program. [0] https://en.wikipedia.org/wiki/Employment-to-population_ratio