The government refers to the new tax bill that introduces a minimum taxable income for the self-employed as a “fair taxation system”, market representatives refer to “sacking” and an “unfair system”.
Market players talk to OT about the new tax bill highlighting the “thorns” of the new self-employed tax system.
Tax bill: Scenarios for minimum income for farmers as well
However, according to the Ministry of Finance, due to tax evasion, the average employee in Greece pays more tax annually to the state than the 85% of freelancers who declare income purely from self-employment. Also according to the statistics of AADE and the General Accounting Office of the State, 71% of freelancers declare an income lower than the minimum wage.
Mr. I. Hadzitheodosiou
The president of the Athens Chamber of Commerce, Ioannis Hatjitheodosiou, regarding the new tax bill and in particular the minimum taxable income, comments that it is a horizontal and unfair measure. While he considers that in order to combat tax evasion, incentives should primarily be given to taxpayers-consumers.
“Horizontal measures are not always fair. Especially on the subject of self-employment taxation, there are many who file under the basic wage because that is their real income. Therefore, their taxation, as the government is going to implement it, does not constitute tax justice and equality that we have requested as EEA.
In order to combat tax evasion more effectively and to avoid the use of cash, I believe it would help to provide incentives to consumers, as costs they currently pay for services are not tax deductible. So they would require their transaction to be done by card, something the financial staff also wants.
A serious problem for micro-businesses is the high fees for transactions made via POS, and the government needs to put pressure on the banks to reduce them. In some cases this amount is higher than the business profit margin.
The financial reward for those who make complaints about tax evasion also creates a negative impression. The point is to gain tax awareness without aiming for any fee for any complaint”, concludes the EEA president.
Mr. G. Kavvathas
The President of the General Confederation of Professional Craftsmen and Merchants of Greece and the Panhellenic Federation of Restaurants & Related Professions, Giorgos Kavvathas emphasizes that the new tax bill once again targets small and very small businesses which, as he says, have suffered the greatest consequences from the successive crises while, as he says, no measures are being taken to combat tax evasion.
“At a time when public revenues are increasing, while consumer purchasing power is declining due to ever-increasing accuracy, the government through recent Treasury announcements has suddenly announced its intention to substantially increase self-employed taxation. Under the pretext of tax evasion, the small and very small businesses that have suffered the greatest consequences from the successive crises were once again targeted.
It is misleading to attribute any tax evasion that exists solely to the self-employed, when issues such as contraband, smuggling and undeclared business activity remain, a deafening demonstration of the State’s failure to deal effectively with them. And of course no reason to deal with legal tax evasion and profiteering. The government should have been more careful. The recent memorable decade of overtaxation is still fresh in the minds of the self-employed, and the imposition of an unfair horizontal head tax will have multiple negative effects.”
Mr. St. Kafounis
The president of the Athens Chamber of Commerce, Stavros Kafounis, tells OT that the tax bill “sacks” all self-employed professionals because some do not comply with their obligations.
“The issue of taxation is important for every citizen and every entrepreneur. We understand the need to crack down on tax evasion and that there are no “smart” and “whores”, but on the other hand, it is not possible to make generalizations and to “sack” all entrepreneurs because some choose not to comply with their obligations.
The government must find a fair way to tax entrepreneurs according to the data they submit to the AADE, using the new digital systems to render Caesar’s to Caesar and to control those whose declared incomes do not correspond to reality. Sound business and especially the commercial world of the country, which now does the majority of its turnover through credit and debit cards, is in favor of anti-tax evasion measures so that the government can further lighten the burdens on them, but this process it must be done with targeted measures and not horizontally”, underlines the president of the merchants of Athens.