Greek-Swiss Treaty: Athens Closes in on Wealthy Tax Evaders
For years, Greece has been pledging to redouble its efforts against tax evasion. Only now, however, is Athens finally set to sign a tax deal with Switzerland in the hopes of generating billions in revenue. Critics, though, say the agreement won’t make much of a difference.
The negotiations have been going for years. And if all goes well, Greece and Switzerland will finally finalize a tax treaty this September which could bring billions of euros back to Athens. Modelled on Switzerland’s agreements with Germany, Great Britain and Austria, the deal is aimed at the billions of euros Athens estimates that wealthy Greeks have parked in the Alpine country to avoid taxes back home.
After months of delays, the three party coalition led by Greek Prime Minister Antonis Samaras now wants to implement the deal as quickly as possible in hopes that they’ll be able to find billions for Athens’ coffers. But there’s also another reason for the rush: Samaras needs to show he is serious about reform. Greece desperately needs a win in its fight against rampant tax evasion.
For one, Samaras needs to demonstrate resolve on the issue to his country’s international creditors. Indeed, the issue was a topic when the Greek prime minister paid a visit to Chancellor Angela Merkel in Berlin last Friday. For another, the Greek government is eager to show honest taxpayers that their dishonest compatriots can’t get off so easy.
The first discussions regarding a bilateral tax treaty between Greece and Switzerland took place two years ago. Last year, there were stories in the Greek press that the deal was imminent. Since then, however, not much has happened; Greeks holding Swiss bank accounts have had little to fear.
The hold up, if one believes Philippos Sachinidis, was for political reasons. Sachinidis is currently a parliamentarian with the socialist PASOK party, but this spring, he spent a few weeks as finance minister under then-Prime Minister Lucas Papademos. His term coincided with the signing of Swiss tax deals with Germany and Great Britain.