Greece signs deal with German state to fight tax evasion

With his government flagging in opinion polls and protests against planned pension reforms growing, Prime Minister Alexis Tsipras is seeking to dispel any negative sentiment by strengthening ties with German authorities to tackle tax evasion on Greece.

Tsipras met on Saturday with the finance minister of the German state of North Rhine-Westphalia, Norbert Walter-Borjans, to rubber stamp this cooperation. The two relevant revenue authorities signed a joint declaration of intent to exchange information and know-how aimed at improving tax collection in Greece.

“For us in North Rhine-Westphalia, it‘s particularly important to give a clear signal of closer collaboration,” said Walter-Borjans.

The agreement allows for 50 Greek tax officials to travel to North Rhine-Westphalia, which accounts for close to one-fifth of Germany’s economic output, to receive training and for administrators from the German state to oversee the implementation of agreed actions in Greece.

“We now have new weapons to fight tax evasion,” said Alternate Justice Minister Nikos Papangelopoulos, who attended a joint press conference with the German official and Alternate Finance Minister Tryfon Alexiadis, a former tax official who is in charge of tax collection.
“We accept the help being offered; we have nothing to hide,” said Alexiadis.

North Rhine-Westphalia also supplied Greek authorities recently with 10,000 data sets on bank accounts held by Greeks in Switzerland, mostly at UBS. It is estimated the deposits total some 4 billion euros. Greek authorities have begun sending out notices to people on the list so they can explain where the money came from and if tax has been paid.

“This is not the first time that Greece has information and lists but it is the first time that Greece is using them,” said Tsipras, referring also to the Lagarde list of depositors in Switzerland, which previous governments had been criticized for failing to investigate properly.

“It would be good to make use of such lists and not just cut spending,” said Walter-Borjans, referring to the potential tax revenues that Greece could obtain by tracking down evaders.