Overdue taxdebt in Greece

Abstract

Accumulation of overdue tax debts has been a thorn in the side of Greek fiscal policy in the past two decades. The dramatic accumulation of tax debts during the crisis of 2008 called for urgent reforms and measures to tackle the problem. Under the pressure of three Economic Adjustment Programmes, the MOU governments embarked on an effort to reform Greek Tax Administration, with emphasis on independence, depoliticization and wider digital transformation. This has been a slow process yet to be completed and the strains to the system introduced by the ongoing health crisis, make the need for reform even more urgent. The present paper puts overdue tax debts into perspective, analyzes the process of accumulation and brings out its main features, assesses the efficiency of Tax Administration and comes up with several policy recommendations. After we profile overdue debts stock and its characteristics, we compile an input-output table, which leads us to the composition of a series of indicators, which help assess the efficiency of tax administration in the context of the fiscal policies of the last two decades. The results of the research indicate poor quality of debts accumulated over time, as well as low efficiency of the Tax Administration, but with some improvement in recent years.