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Is this even really relevant? There is widespread unemployment, taxes are jacked up, money is fleeing the country either to pay creditors or for foreign banks. If anything, there is huge incentive now NOT to pay taxes.
by Upstate NY on Fri Jul 10th, 2015 at 10:41:42 AM EST
I think it is relevant to the diagnosis of what was wrong with Greece society leading up to the crisis. It's probably still relevant today for tax policy escept that the Greek government has much bigger fish to fry today than VAT dodging.

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Fri Jul 10th, 2015 at 11:05:07 AM EST
[ Parent ]
It's very relevant.

If it's true, then it's relevant because it needs to be handled so this shit show doesn't happen again.

If it's false, then it needs to be debunked, because news coverage like this will continue to appear:

SIEGEL: When you say that Greece has failed to make a transition to modernity, what do you mean by that?

PALAIOLOGOS: Well, I mean, basically, that since the beginning of modern Greek history, we have failed on a number of levels to construct a modern, Western-style state with, you know, the rule of law and with proper taxation which will pay for modern services for its citizens. There's obviously been a lot of improvement since the 1830s, to a large extent in the last few decades thanks to the European Union. But it's still the case that most of the Greeks view the state with great suspicion. They don't view it as the embodiment of the common good, and they're reluctant to pay taxes. And then, of course, they complain for the shoddy services they get in return.

SIEGEL: If they don't see the state as representing them, what do they see as representing them?

PALAIOLOGOS: Well, there's a great deal of tribalism connected with political parties or with unions or local interests of various kinds. And people try to use their affiliation to various groups like that to, in a major or minor sense, plunder the state. They get things from it - anything from, you know, government contracts to a government job or, you know, to get the tax man to look the other way when they themselves do not contribute to that state. They see it as something to be plundered and not something to contribute to.

Greece's Financial Crisis Related To Design Of Eurozone | NPR

and this:

Centuries of rule by outsiders have left a disconnect between the citizens and the state and a tradition in which avoiding paying taxes and outwitting that state became a patriotic duty.  ...

Greece is a tough environment for entrepreneurs, says Koufopoulos. "Greeks have a Left-wing heart and a Right-wing pocket. This is a very divided economy. There is a private sector that works very hard and a huge public sector that was has been brought up without taking any risks and an increasing sense of entitlement. People are very strong for socialism, but when it comes to their pockets they don't want to pay taxes." ...

Decades of rule shared between Pasok, the socialists, and the conservative New Democracy party, saw a cosy consensus about patronage networks, says Palaiologos. "Pasok and New Democracy disagreements were about who would run the state and spread the patronage networks. All this relativises citizens' allegiance to the state. They ask, 'why should I pay taxes when the government just lines its pockets?' When roads and hospitals are built, it's without any cost control. " ...

Despite the volatility of national politics, Left and Right agree that things cannot continue as they are. "We need a deep structural reform programme to make the changes that we want," says Papandreou. "Pensions are not the real issue. We need to fix the tax system. Corruption and high taxes lead to more corruption. We have made changes, we have introduced property and luxury taxes, but not enough changes." ...

The Greek crisis reveals a nation crushed by ancient history | Newsweek

etc.

Point n'est besoin d'espérer pour entreprendre, ni de réussir pour persévérer. - Charles le Téméraire

by marco on Fri Jul 10th, 2015 at 11:12:41 AM EST
[ Parent ]
I don't look at ethnic or genetic stereotyping as he does. This is NOT a question of Ottoman mindsets, etc.

It's a matter of non-functioning gov't. The tax evasion thing comes at the very end of considerations for me.

First, Greece is overloaded with small businesses related to tourism. They are always going to have a tax evasion problem.

Second, Shipping accounts for 15% of GDP, which makes the tax evasion calculation look worse than it already is.

For example, Greece had 40% of GDP in tax revenue for years. More than enough to pay for necessary services. When you consider that 15% of the GDP was legally untaxed (shipping), that figure should rise even higher.

Then also consider that Greek tax evasion has to be compared to tax evasion elsewhere.

The Greeks have a lot of it, but not so much more that a dent into it is going to change the dynamics of the economy.

Check out this paper here that shows that 14% of the population was responsible for the 28% tax evasion, because the others lived by paycheck (i.e. they were taxed at the source.)

http://eprints.lse.ac.uk/26074/1/GreeSE_No_31.pdf

by Upstate NY on Fri Jul 10th, 2015 at 01:48:02 PM EST
[ Parent ]
The tax evasion thing comes at the very end of considerations for me.

Really? So what is at the top of your considerations about a better functioning government?

"Dieu se rit des hommes qui se plaignent des conséquences alors qu'ils en chérissent les causes" Jacques-Bénigne Bossuet

by Melanchthon on Fri Jul 10th, 2015 at 03:50:37 PM EST
[ Parent ]
1. Corrupt officials go to jail. I start there. 2. Taxes go to functioning gov't (i.e. debt relief necessary). 3. The black market (reassign military unit to interdicting the black market).
by Upstate NY on Fri Jul 10th, 2015 at 05:20:29 PM EST
[ Parent ]
These shipping magnates threatening to relocate, are they willing to renounce Greek citizenship?

Seems idiotic to sabotage the small tourism businesses, seems typical how predatory capitalism cannot allow any shoot of success to occur without wanting to squash or own it. what they should do is lower taxes on small businesses to encourage more tourism, instead of throttling their (practically only) rebounding sector, which if managed properly could raise visitor numbers exponentially. Let them get ahead before upping taxes! They may be in debt and need time to get out from under it.

Europe should unite against offering new locations for tycoons to avoid paying taxes in their native country, and should nudge Switzerland, Monaco, et al to comply with this.

If Europe wants to get back its honour in 'practicing economics as if people mattered' it better move fast to install more fairness against its financial industries and those who have been using Gvt funds (and unholy amounts of EU money) as ATMs. These ripoffs should be traced and returned to the treasury stat, perps prosecuted.
Actions this radical would go a long way towards soothing the predators creditors' fears and counter the propaganda in the German gutter press, (who should be also sanctioned for shitstirring at such an critical and inflammatory moment in European history).

Another incidence (like the Hebdo and Danish cartoons) where an absolute fetishisation of free speech has been tantamount to tossing a lit cigarette out of a car window into forest tinder in a drought.

'The history of public debt is full of irony. It rarely follows our ideas of order and justice.' Thomas Piketty

by melo (melometa4(at)gmail.com) on Fri Jul 10th, 2015 at 08:16:31 PM EST
[ Parent ]
During the crisis, Greek businesses have relocated HQs all over the eurozone, for tax advantages. Some mining companies even established mailbox HQs in Holland for this purpose.
by Upstate NY on Sat Jul 11th, 2015 at 08:51:54 AM EST
[ Parent ]
Not only tax advantages. Youd want a foreign bank account, too.

A society committed to the notion that government is always bad will have bad government. And it doesn't have to be that way. — Paul Krugman
by Migeru (migeru at eurotrib dot com) on Sat Jul 11th, 2015 at 09:34:38 AM EST
[ Parent ]
Oh yes, I totally forgot about that. Greek Coca-Cola bottler, a stalwart in Greece for decades, gave it up for this reason.
by Upstate NY on Sat Jul 11th, 2015 at 11:55:31 AM EST
[ Parent ]
Except these are 2009 figures, not yet impacted by austerity policies... So what was the incentive not to pay taxes, then?

"Dieu se rit des hommes qui se plaignent des conséquences alors qu'ils en chérissent les causes" Jacques-Bénigne Bossuet
by Melanchthon on Fri Jul 10th, 2015 at 03:58:44 PM EST
[ Parent ]
Lack of services and functioning gov't; corruption, and the #1 reason: because you could.
by Upstate NY on Fri Jul 10th, 2015 at 05:18:23 PM EST
[ Parent ]

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