Measuring Up the Real Cost of the Greek Bail-out

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The cost of tax evasion in Greece and Spain now outstrips its national debt - so why isn't the emphasis on improved tax collection rather than external financial aid? The Federation of European Employers (FedEE) reports....

The Federation of European Employers (FedEE) estimates that Greece's annual tax revenue is at least EUR 27bn lower and Spain's tax revenue 128bn lower than if all tax due had been collected from its population. On June 6th Transparency International will publish the results of a study commissioned by the European Union into corruption and tax evasion. The initial results for Greece reveal a mechanism where the demand for bribes by public officials is causing a crisis of values leading to widescale tax evasion. With the European Union and IMF poised to make further payments to Greece under its EUR 240bn bail-out it is perhaps time to ask whether better tax collection, rather external aid, would not be the answer for ailing economies such as Greece and Spain.

Speaking on Sky News on May 18th 2012 FedEE’s Secretary General Robin Chater said “Perhaps it is now time to send in a crack team of specialised tax inspectors and collectors to implement processes and controls that are clearly lacking – in the same way that the EU’s crack team of specialised border guards are deployed where border controls are weak."

What is FedEE?

The Federation of European Employers (FedEE) is the leading think tank for multinational companies operating in Europe. It was founded in 1989 with assistance from the European Commission and has its head office in London, UK

For further information and comment contact Alison Merrett on 0207 520 9264 or Alison(dot)merrett(at)fedee(dot)com or Robin Chater directly on robin(dot)chater(at)fedee(dot)com. Website: http://www.fedee.com

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