A report from the Greek Finance Ministry has found that while many Greeks have been hit with pay cuts, tax hikes and slashed pensions during a crushing economic crisis, that most self-employed businesspeople are declaring low incomes, including below the poverty line and under levels at which they would be taxed.
According to the Ministry’s data, 779,319 freelancers declared earned an average income of 13,307 euros annually (1,109 per month) while 550,000 declared an income below the tax exemption limits valid for 2011 and paid no tax at all, echoing another report that many of the country’s famous singers are paying low taxes or none at all, with some claiming they have no income or property although they live in villas.
Desperate for cash to keep the sinking economy afloat, the new uneasy coalition government of Prime Minister Antonis Samaras is about to hit workers, pensioners and the poor with new pay cuts, tax hikes and slashed pensions, while Greece’s notoriously tax-evading elite now find themselves being joined by the self-employed who are reporting incomes allowing them to pay minimal taxes – or none at all – and won’t be affected by the new measures.
The highest incomes were declared by the 417 medical center owners, who – unlike many self-employer – provide receipts. In the other 575 sectors, including 778,901 self-employed, some 70 percent declared annual revenues under 50,000 euros a year as business owners. It’s a common practice in Greece to cheat on taxes by failing to give receipts, especially among professionals such as doctors, lawyers, architects and engineers.
Some 60 percent of the self-employed individuals said they made less than 12,000 euros on average in 2011, making their income tax-free. For those married with children there were higher tax exemptions and it was estimated that approximately 550,000 individuals (equal to 70 percent of all free-lancers) did not pay a single euro in taxes while the government was squeezing others in harsh austerity measures aimed primarily at workers, pensioners and the poor.
In 2011, pensioners and workers, whose pay and benefits had been cut, reported an average income of 13,000, down at least 1,000 from the previous years, but the data showed those earnings were higher than reported by taxi drivers, singers, restaurant owners, plumbers, electricians, and hotel, bar and night club owners who said they made less than pensioners and civil servants, declaring they had to live off their wive’s incomes to survive, claiming a total family income of 20,513 euros a year, or about $26,266.
Doctors declared higher incomes in 2011, while pharmacies, gambling agencies and kindergartens also did. Lower incomes were declared by mechanics, lawyers, gas station owners, accountants and notaries, whose income ranged from 17,000 to 21,000 euros. Taxi drivers said they made less than 10,000 euros on average, while bakery and grocery store owners and salesmen in open air markets declared an even lower income. Small and medium traders and wholesalers said they earned only 15,000 euros last year and private school owners reported only 20,000 euros made from their businesses.
Hairdressers – who have a hazardous professional status allowing them earlier retirement – said they make 12 euros, or $15.30 a day, less than what a single customer might typically pay, equivalent to the 330 euros monthly pension for those in the Agricultural Insurance Organization (OGA.) Some 30,000 nightclub and bar owners reported monthly incomes of 550 euros, or $704, despite typical prices of $5 for a bottle of beer and upwards of $8-$12 for mixed drinks inspectors find are often diluted with water. Another 35,000 restaurant owners claimed to have earned only 500 euros, or $640 per month.
(Information: ProtoThema.gr)
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