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Greece’s Ministry of Finance has launched an operation of compulsory “card payments” throughout the country and for this purpose debit card devices (POS terminals) will be installed for all occupations and companies, even in street kiosks. The main purpose is to combat tax evasion. In this way, all freelancers will have to obtain POS terminals to accept debit card payments whereas card payments will become compulsory at a later stage. The plans of the Ministry of Finance originally provide for applying the compulsory use of debit and credit cards to the new companies that will be established in 2016, and in some professional fields, that are on the top of the list of tax evasion. The list of occupations that must use debit cards in 2016 includes doctors, lawyers, electricians and plumbers, and certain areas that will be chosen according to the percentage of violations and tourist flow will be included in it as well.

Deputy Minister of Finance Trifon Alexiadis said that incentives would be provided to both consumers and businesses in order for cards to gradually replace cash. In turn, chief secretary in charge of government revenues in the Ministry of Finance Katerina Savaidou has to establish commissions and workgroups to find how to make the transition to the new settlement relations.

Workgroup

By decision of Katerina Savaidou, another workgroup is being established whose task is to prepare and develop a valued plan to promote and facilitate electronic payments and reduce the use of cash. Within this context, the workgroup will explore issues relating to the following:

• Compulsory use of transfers for customs revenues (ICIS net).

• Acceptance of payment cards issued by foreign institutions for the provision of payment services and for revenues in the Ministry of Finance.

• Acceptance of payment cards by companies and individuals, freelancers, through the use of POS terminals.

• Complete ban on the use of cash in the tax services.

• Completing the electronic system for the payment of fees, mainly through the inclusion of those ministries that have not yet taken the necessary steps to include their fees in the electronic payment system and of other state institutions.

The new workgroup will act in cooperation with the workgroup that is already operating within the general secretariat for state revenues. Its task is to explore the opportunities for a direct and online data transfer from the tax documents issued for the wholesale of goods and services. The workgroup has to submit its report with conclusions to the general secretariat for state revenues by 31 December 2015.

The widespread use of debit and credit cards for payments may largely restrict VAT evasion but it cannot fight the classical way, in which no receipts are issued. In this case, the Ministry of Finance loses not only VAT revenues but also income tax revenues from those who do not issue receipts and conceal their actual income from the tax authorities. To offset this phenomenon the plan of the Ministry of Finance provides for incentives for taxpayers and businesses. For companies, the incentive provides for the option of not even submitting returns and at the same time, for opening an inviolable account for direct payment of VAT for each company, without requiring the submission of a periodic statement.

For taxpayers, the incentives provided for the use of debit and credit cards for payments will include raffles with gifts, the provision of a non-taxable limit and even different gifts offered by banks.