TAX AMNESTIES & TAX COMPLIANCE:
THE CASE OF GREECE
Tonia Pediaditaki, Lawyer (LLM, DEA)
Panel 4:
Challenges in “Operationalizing” Taxpayer Rights
November 19, 2015
International Conference on Taxpayer Rights
Washington DC, November 18-19, 2015
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Conflicting objectives?
Tax
Revenue
Tax
Compliance
3
Types of Tax Amnesties
Main features of Tax Amnesties
▪ Extent of coverage:
▪ Taxpayers eligible
▪ Type of tax or tax base
▪ Timing:
▪ How long is the programme available?
▪ Extensions granted?
▪ Frequency
▪ Benefits offered
▪ Financial
Types of Tax Amnesties
▪ Standard Tax Amnesties
▪ Standing Permanent Tax Amnesties
▪ Extensive Tax Amnesties
▪ Tax Amnesties aiming at the
Repatriation of flight capital
▪ “Voluntary Disclosure Programmes”
▪ Other: eg. Anonymity
▪ Leverage
4
Taxpayer behaviour and attitudes to compliance
General Factors influencing
taxpayer behaviour
TAX AMNESTY PERSPECTIVE
BUSINESS INDUSTRY
•Taxpayer is an individual economic actor  seen
as CUSTOMER?
•Tax amnesty seen as a PRODUCT to be sold?
TAXPAYER
SOCIOLOGICAL
•Marketing?
• “Get to us before we get to you!”
ECONOMIC
PSYCHOLOGICAL
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Tax Amnesty and Trust: the side-effects
NON – COMPLIANT TAXPAYERS
(Target group of tax amnesty)
COMPLIANT TAXPAYERS
▪ Tax amnesty offers a motivation to
comply and come forward
▪ Tax amnesty offered to noncompliant taxpayers induces:
 Revenue generation
 Loss of trust & tax morale
 Tax compliance
 risk for future compliance
 risk of tax base erosion
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GREECE: I. Tax amnesties for Capital Repatriation
Inspiration: Italian Tax Amnesty (Tax Shield, Scudo Fiscale)
1. Law 3259/2004 (Art. 38)
▪ August 2004 – July 2005
▪ 3% flat tax on capital already abroad when Law entered into force and repatriated through
financial institutions in Greece
2. Law 3842/2010 (Art. 18)
•
23 April 2010 – 30 September 2011
•
5% flat tax if capital is repatriated and invested in Greece for 2 years
•
8% flat tax if capital is declared to Greek tax authorities but not repatriated
•
Law 3691/2008 on money laundering remained applicable (no criminal amnesty).
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GREECE: I. Financial benefits of tax amnesties
Tax Amnesty 2004
Tax Amnesty 2010
▪ Goal announced: EUR 5-10 billion
▪ Goal announced: EUR 20 billion
▪ Capital repatriated: EUR 1.5 billion
▪ Capital repatriated: ca. EUR 425
million
▪ Tax revenues: EUR 50 million
▪ Tax revenues: ca. EUR 25 million
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GREECE: II. “One-time-only tax settlement” again, and again,
and again…
1.
1978 (until 1981)
2.
1988
3.
1991
4.
1994  very successful in financial terms (450 billion drachmas of taxes collected)
5.
2002 [for years 1999-2001]
6.
2002 [for years: 1993-1998]
7.
2004 [for years: 1998-2003]
8.
2008 [for years: 2000-2006]
9.
2009 [same tax amnesty as 2008]
10. 2010 [years: 2000-2009]
11. 2015
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Greece: III. 2015 - Another tax amnesty under way?
▪ June 2015, new draft law on global tax amnesty to repatriate overseas funds to
Greece  public consultation but never submitted to Parliament
- voluntary disclosure programme for limited time-period
- 15% flat rate on declared offshore funds
- tax obligation exhausted
- tax certificate issued
- criminal penalties waived !!!
- agreement with Switzerland?
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Pay tax, plus interest,
plus applicable penalties,
plus possible fines and jail
Avail themselves of
Voluntary Disclosure
Programmes to pay tax
plus interest and/or a
penalty and/or a fine
Pay tax when due
Source: OECD (2015), Offshore Voluntary Disclosure Programmes, p. 10
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Decision #1: Establish the
Reason
Decision #2: Determine the
scope
Decision #3: Establish the
Terms
Decision #4: Establish
Reporting Requirements
Decision #5: Consider the
Opportunity for Intelligence
Gathering
Decision #6: Βuild a
communication strategy
• Opportunity for voluntary disclosure to ALL taxpayers
• Opportunity for voluntary disclosure to SPECIFIED taxpayers, for SPECIFIED duration in order to
address a SPECIFIC issue.
• Available taxpayers + Open-ended (no specific date for terminating the program
• Available only to those who fit the criteria + Specified duration of the programme
• to all
• What is the incentive for taxpayers to come forward?
•General program OR Specific programme?
•Tax waived? [None, Some, or All]
•Interest waived? [None, Some, or All]
•Prosecution waived?
How does the taxpayer make the voluntary disclosure?
- HOW? i.e Specified form, questionnaire, letter?
- WHEN? i.e. at least 1 year late
- WHO can make the disclosure? i.e. taxpayer/accountant/legal representative
Beyond assessing taxes, is there a desire to gather further information?
- Identify methodologies
- Identify schemes
- Identify promoters
- Identify information available
- Design a communication strategy
- Attract the targeted taxpayers and encourage them to use the programme
- Communicate with the already compliant taxpayers – to create an understanding of the
programme and avoid resentment
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Features of a successful tax amnesty programme
▪ Clear about its aims and terms
▪ Deliver demonstrable and cost-effective increases in tax revenues
▪ Be consistent with the generally applicable compliance and enforcement
regimes
▪ Help to deter non-compliance
▪ Improve levels of compliance of among the population eligible for the
programme
▪ Complement the immediate yield from disclosures with measures that
improve compliance in the long-term
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How to integrate taxpayer rights into tax
amnesty programmes?
▪ Fairness and equity principles!
▪ Care about non-compliant taxpayers who are the target of the program but also
about law-abiding taxpayers
▪ Transparency and diffusion of information about voluntary disclosure programmes
 guidance notes, information packs etc.
▪ Confidentiality and use of information disclosed
▪ No-name discussions
** OECD Standard on Exchange of Financial Account Information for tax purposes
(2014)
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Thank you!
tpediaditaki@gmx.com