Cyprus Mail
CM Regular Columnist Opinion

Still stealing what’s left of our money

Fired cleaners from the Greek finance ministry shout slogans during a protest in central Athens earlier this year

By Hermes Solomon

The European Central Bank (ECB) has finally decided to print money in an effort to bolster economies, ergo the present fall in the value of the euro against major world currencies. This money is not going into the pockets of ordinary citizens, but into banks, which caused the economic crisis in the first place.

It is commonly believed that the Greeks do not pay taxes, yet 80 per cent of the population are taxed on their income at source, while the remaining 20 per cent (les grandes fortunes) escape paying their fair share of taxes with the aid of specialist consultant tax firms.

What the Greek government call ‘special taxes’, introduced at the command of the troika (austerity measures) have hit the middle class right between the eyes – blinded them in fact.

The poor will always be poor whatever they receive in state welfare provisions, but the middle class are now struggling to pay those ‘special taxes’ in a country where pensions are now taxed at around 30 per cent and immovable property tax (IPT) which was negligible ten years ago, has risen in some cases by as much as 750 per cent.

A retired couple (one formerly a director of a primary school and the other a secondary school) receive two separate state pensions totalling 2800 euros a month gross. After tax, the residual 1900 euros no longer covers the ‘special tax’ increase in the cost of living.

Rather than not pay for the increased cost of healthcare, (of primary concern for the aged) heating, lighting, IPT, etc. the couple consume less. There is rarely enough food on the table, no more pandering to grandchildren and costs are shared out with their own children, who are white collar workers and also struggling to survive in this now almost third world country.

By contrast, Greek shipping magnates have been advised by their bankers to change their flag of convenience to further avoid paying taxes.

Since the inception of the EU, inequality between the classes is now greater than ever and Brussels seems powerless to stem this ever growing disparity.

Tax rates throughout the EU do not conform. Lobbyists of powerful multi-nationals apply pressure to gag those EU parliamentarians seeking fiscal conformity and justice, arguing that rich man’s money filters down to feed the poor – which is nonsense, when billions of multi-national tax-free profits are hidden in tax havens.

Multi-national profits should be creating jobs and bolstering economies, instead this money sits idly mounting, and for what purpose?

How many billions were filched out of Cyprus before the bail-in and banking lock-down? Who took it and where exactly did it go? That’s what the House finance committee and auditor-general should be investigating, not some scapegoat civil servant for misusing a rubber stamp to benefit multi-millionaire, non-performing loans property developers.

Democracy demands that social justice should seek equality of real freedom of movement. Surely, the poor should not be charged VAT at all! An extra 20 per cent charged to the rich on the price of goods and services is meaningless. But to the poor, today, it’s make or break.

Before VAT was introduced, taxation was progressive, the lower class untaxed, the middle class taxed something and the rich taxed a lot.

But over the years, VAT rates have increased mercilessly and progressive taxation of the rich fallen dramatically. Thus the rich are getting richer and the poor are starving.

Too much tax kills the market. Yes, but what sort of tax, progressive or across the board?

Without taxation there would be no state schools, army, fire service, OPH’s, police, road repairs, student grants, free healthcare, etc. But these services have been cut to the bone in Greece, and are in the process of being similarly slashed in Cyprus.

It has been said that higher taxes reduce the incentive to work; disproved in Denmark, where everybody pays from the day they start work in a country which offers the best public services in Europe, if not the world. And the rate there is 50 per cent across the board, some part aimed at protecting the environment, which should be of major concern to governments given the speed at which the planet is imploding due to climate change.

Have you noticed how ‘special taxes’ in Cyprus are creeping up to match the Greek model? The Inland Revenue is suddenly digging deep into past income tax returns – as far back as ten years in an effort to collect unpaid taxes. Will those unpaid taxes benefit the treasury or simply pay off ‘bankster’ embezzlement?

There is still no co-ordination between EU states on equitable taxation – sovereignty or collectively – no harmonisation. States deal according to their own individual interests – all for one in words but me for myself enacted.

Liberalising markets has benefited the rich to the tune of one trillion euros annually – a tax evasion disease perpetuated worldwide.

Governments must go for fiscal fraudsters – it’s the only way forward. But instead they continue ‘stealing’ what little money we have left rather than inoculating us against those fraudsters.

It is all well and good governments claiming low rates of inflation, but by what criteria is inflation assessed nowadays? Evidently, ‘special taxes’ are not taken into account…

Equality creates a fairer, happier and healthier society. But if multi-nationals and many professions (lawyers, private sector doctors, etc.) persist in refusing to pay their fair share of taxes, the eventual outcome for us all will be catastrophic.



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