Cash Ban: Greeks Face “Per­ma­nent Cash Con­trols and Com­pul­sory Use of Plas­tic Money”

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In a stun­ning move towards the elites’ endgame of ‘ban­ning cash’, Greek author­i­ties unveiled stricter cap­i­tal con­trols for civil ser­vants and pen­sion­ers this week­end. By dras­ti­cally lim­it­ing cash with­drawals and forc­ing the more ‘con­trol­lable’ com­pul­sory use of plas­tic money, Greek author­i­ties hope to stop tax eva­sion through the use of ‘fake cash registers’.

As Keep​Tak​ing​Greece​.com reports,

A shock-​measure: civil ser­vants and pen­sion­ers will be sub­ject to stricter cap­i­tal con­trols than the rest of the Greeks. They will be able to with­draw only €150 per week – with the cash with­drawal cap being €420 per week – that is a total of €600 per month. The rest of their wage or pen­sion they will have to spend by using debit or credit card.

The news fell like a bomb­shell on Sat­ur­day evening and spoiled the week­end of mil­lions of Greeks. It will prob­a­bly spoil the rest of their lives too.

Greek media revealed, that the Finance Min­istry plans to impose such a mea­sure in order to com­bat tax eva­sion, but of course, not the tax eva­sion com­mit­ted by the civil ser­vants and pen­sion­ers as this is not pos­si­ble as the state deducts their share on tax before they receive wages and pen­sions but the tax eva­sion com­mit­ted by busi­ness owners.

Accord­ing to the Finance Min­istry plan, civil ser­vants and pen­sion­ers will be able to with­draw in cash only part of their wages and pen­sions and the rest will have to remain in their bank deposit account. This remain­ing amount they will have to spend only through the com­pul­sory use of debit or credit card.

“The mea­sure will affect 2.65 mil­lion pen­sion­ers and 600,000 civil ser­vants,” notes news­pa­per To Vima that revealed the shock­ing plan.

The news­pa­per adds that with this mea­sure, the com­pul­sory use of plas­tic money, the busi­ness owner , whether a shop or a pro­fes­sional like doc­tor, plumber etc will not be able to evade taxes since all trans­ac­tions will be recorded in the bank­ing system.

The Finance Min­istry rea­son­ing behind this plan is first of all the assump­tion that the money – or large party of the money – it pays in wages and pen­sions is been used in real econ­omy with­out receipt thus with­out Value Added Tax and tax rev­enues for the state.

“Every month the State and the pen­sion funds pay for salaries and pen­sions of approx­i­mately €2.6 bil­lion, that is €30 bil­lion per year. The salary or the pen­sion comes into the bank account of the ben­e­fi­ciary, who can with­draw 420 euro per week due to the cap­i­tal controls.

This cash money is being used for the pur­chase of goods or ser­vices “and a large per­cent­age of these trans­ac­tions does not bring rev­enues to the state as the trans­ac­tions are being done with­out the issue of receipt or receipt are issued by so-​called fake cash reg­is­ters which are manip­u­lated to show less revenues.

In this way, the state suf­fers rev­enue losses of approx­i­mately 1520 bil­lion euro per year due to not col­lec­tion of Value Added Tax and income tax,” from busi­nesses and self-​employed.

With this mea­sure the state cal­cu­lates that it will receive in no time rev­enues from V.A.T. and will not miss a cent from income tax. The state expects to rapidly increase its rev­enues and “pro­ceeds to future reduc­tion of the tax rates of 8.500,000 taxpayers.”

The Finance Min­istry appar­ently con­sid­ers to exempt pen­sion­ers of over 75 years old from the mea­sure as well as those liv­ing in remote areas where the use of plas­tic money is limited.

If the mea­sure suc­cess­fully increases the state rev­enues and does not puts obsta­cles in the oper­a­tion of house­holds, “it can be extended also to salaries of the pri­vate sector.”

* * *

The plan rev­e­la­tion trig­gered an out­cry and anger not only among the civil ser­vants and pen­sion­ers but also among those not affected by it. But there is more…

Plas­tic money com­pul­sory for new companies

Another mea­sure is appar­ently under way in the fight of tax evasion.

Com­pa­nies that are founded from next year onward plus a range of sec­tors of the Greek econ­omy will only be able to accept pay­ment via debit or credit card, accord­ing to a plan being drawn up by the government.

The plan, which has yet to receive the final approval from the country’s lenders, fore­sees all new com­pa­nies hav­ing to be equipped with point of sale (POS) ter­mi­nals that can accept credit and debit cards. The same will apply to numer­ous pro­fes­sions like will include doc­tors, lawyers, elec­tri­cians and plumbers, which are all pro­fes­sions where tax eva­sion is thought to be rife.”

(full arti­cle ekathimerini)

Also in this case, the ambi­tious leg­is­la­tor will cre­ate 2 busi­nesses cat­e­gories and exclude form com­pe­ti­tion the new com­pa­nies as they will not be able to accept cash.

Who wins?

One has also to ask who wins from these mea­sures except the state and the rev­enues it cal­cu­lates to receive.

For sure the biggest win­ner are the banks: first of all, they will keep longer the amounts of pen­sions and civil ser­vants salaries. It could be 11.5 bil­lion euro per month. Sec­ondly, because they charge 2 euro per trans­ac­tion via debit or credit card.

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