By Chrysostomos Tsoufis

The historian of the future will record that in the saving year 2024, the then government of Greece prepared the first budget in its history that states exactly how much money came from limiting tax evasion. Now everyone’s question “and how much do we get from tax evasion” has an answer. €1.8 billion

Her limitation tax evasion is “responsible” for 50% of revenue overruns over original estimates. Public coffers received €3.7 billion more than had been calculated. €1.8 billion is due to tax evasion and €1.9 billion to the development of the economy. All this without a single tax increase, in fact as the Ministry of Finance notes in the presentation of the final budget plan, in 2024 7 taxes were reduced.

€1 billion of the outperformance of revenue growth comes from VAT collections. Given that neither inflation nor private consumption rose more than initial estimates, it is safe to assume that the total comes from curbing tax evasion and increasing electronic transactions.

The Ministry of Finance estimates that this year the value of purchases made through electronic transactions will increase by 11% or almost €7 billion. From €61.1 billion in 2023 to €68 billion this year.

For example, in the TAXI sector alone, electronic transactions in the first 8 months of this year have increased by 177%. From €18m in 2023 to €50m with the projection showing a final amount for this year at €73m.

Naturally, someone will argue that all these transactions do not constitute tax evasion as a whole, and they will be right. Figures show that the VAT gap (ie VAT losses) in cash transactions is 25-30% while in electronic transactions almost 0.

€1.1 billion is the overperformance of revenues from corporate income tax. If the €300m of the refinery levy is deducted the remaining €800m can safely be argued to be credited to anti-evasion efforts.

One will argue that at the same time we have an increase in the growth rate, so businesses are reporting more and they would be right. Partly. This is because both investments and labor costs are increasing at the same time (5.2% this year in dependent labor wages and 4.3% in wages per employee) with the result that the declared business income is less.

The €1.8 billion from the reduction of tax evasion means that we are at 72% of the target set for the end of the four years. Then, until the end of 2027 that is, the government estimates that the cumulative revenue from this part will have increased by €2.5 billion. So we are chasing an additional €700m at least.

Despite all this, the 2025 budget does not foresee even €1 of overperformance from measures to enhance tax compliance. “First we will establish them and then we will measure them” commented an official of the Ministry of Finance.

However, they reasonably expect overperformance. In 2025, the connection of businesses to POS will count for 12 months and not for 6 as it was done this year (in June most of it was completed), so will the measure of myDATA. From 2025, the measure of the digital transport pass will also be implemented, while the digital work card will also provide resources in the area of ​​tax evasion. And of course there will be other measures.

Curbing tax evasion is of key importance because it is the main source of raising resources to be directed towards tax reduction. Given that Brussels now has its eyes on how much countries spend, any PERMANENT increase in revenue can be directed to other policies as long as it is proven to be permanent.