A decision by the Greek Government to double tax Greeks abroad who fail to declare their financial interests in Greece has soured the relations of the Greek diaspora with the mother country.
The law (3943/2011) passed by the Greek parliament last year entangles the diaspora in the cogs of the infamous Greek bureaucracy which rates amongst the lowest in the world. The controversial law compels all Greeks abroad who spent more than six months in Greece to declare their “global income”, that is their income in Greece and their countries of permanent residence, to avoid being double taxed.
Greeks who collect income in Greece from business activities, leasing of properties, interest from bank deposits, trade of shares or bonds or from other investments are obliged to declare their income together with proof of their taxable income in their country of permanent residence. Failure to comply with the law will be treated as tax evasion and will incur a double tax impost.
Greeks of Australia with such financial interests have been asked – without prior notification – to submit to the Greek Taxation Office by the end of the calendar year (31 December 2012) their income tax forms together with a certified copy of their last tax return from the Australian Taxation Office – proof of them been taxed in Australia – and certified records of arrivals and departures from Greece – confirmation of the length of their sojourn in the mother country.
More importantly the inept Greek bureaucracy have failed to provide the Greek Consular Authorities in Australia with the requirements for the issuance of the “Certificate of Tax Residence” (Πιστοποιητικό Φoρολογικής Κατοικίας) pursuant to the aforementioned law.
Anxious members of the Community who rushed to the Greek Consulate of Greece in Melbourne to obtain the Certificate or made inquiries on the telephone were told “the authority has not received instructions from Athens for the issuance of such Certificate”. And even if they did the depleted personnel of the consulate – due to the economic crisis Greece is facing – would be unable to issue the Certificate before the end of the year.
During his visit to Australia the President of the Permanent Parliamentary Committee for Greeks Abroad, New Nemocracy MP Mr Adonis Georgiadis, told Neos Kosmos ”his committee has asked the Ministry for Finance for a three months extension that will allow members of the Greek Community of Australia to procure and submit all documents to the Greek Taxation Office” and gave the commitment “to raise the matter again with the ministry upon his return to Greece”.
Mr Georgiadis explained that “the same law has been passed by parliaments of the other states-members of the European Union within the context of the decision of the Union to eradicate tax evasion within its borders.
We do not ask our compatriots to submit to the Greek Tax Office details of their taxable income in Australia. All we ask for is official proof that Hellenes of Australia with financial interest in Greece are taxed in Australia”.
Neos Kosmos understands that the Greek Embassy in Canberra has also suggested to the relevant ministry a three month extension citing the practical difficulties impeding the issuance of the certificate by the consular authorities before the due date.
Until yesterday Athens maintained its silence thus prolonging the agony of the Greek Community of Australia, about their treatment by the Greek Taxation Office if the requested extension is not granted by the Ministry of Finance.
The introduction of the “Certificate of Tax Residence” is a purposeless bureaucratic innovation which will burden members of the Greek community of Australia with preventable expenses and unnecessary heartaches.
For decades the Greek authorities accepted the declaration of our permanent resident of Australia status on the annual income declaration form submitted to the Greek Taxation Office. The demand for additional “official” proof of our status and of our compliance with the Australian tax laws is nothing short of madness.
The Greek Government must appreciate the danger of alienating the Greek Community of Australia, in particular the younger generations of Greek-Australians who are not accustomed to dealing with governments who legislate and implement legislation on the run. They can either repeal the law or simplify the procedures for obtaining the “Certificate of Tax Residence”.
Furthermore the Greek government must consider signing a Double Tax Avoidance Agreement with Australia as it has done with 47 other countries, thus encouraging the Greek diaspora to maintain and enhance, wherever possible, their economic relations with Greece.