ATHENS – While Greece is improving its record in using European Union subsidies and refitting its tax administration, it’s still faltering in chasing tax cheats and providing bank credit to business.
That was the assessment of the seventh report of the European Commission’s Task Force for Greece.“You need to catch tax dodgers if you want to reduce your taxes,” a top Commission official said at the presentation of the report in Athens. “If tax administration had been more efficient, we could have reduced that tax burden,” he added.
Despite that slap, the report praised the progress in some tax procedures and the main corporate procedures such as debt collection and the payment of value-added tax rebates. It also saw progress in checks related to illegal activities, with staff acquiring more skills and Task Force experts offering “guidance in the workplace.”
Another positive aspect is the operation of the bank account register, the report noted. But the task force noted a number of areas where there were continued failures.
“The issue of loans to the real economy in Greece needs further improvement. The sector is still recording high levels of non-performing loans, while the issuance of loans remains limited and is characterized by high requirements in guarantees and by high interest rates,” the report said.
The lack of cash flow, with banks not lending adequately despite getting 50 billion euros ($67.3 billion) in state monies from international bailouts, is also hindering growth, along with a bad loan rate of more than 40 percent with people buried by austerity measures unable to afford paying mortgages, credit cards and obligations.
On the absorption of EU subsidies, the report praised Greece’s rise from 18th spot in the EU at the end of 2011 to fifth, having steadily improved its rate of absorption from the Structural Funds for the 2007-13 period.
Still, it warned of a possible “overcommitment of funds” for the next funding period (2014-20).