Greece vows tougher tax policy

[May 02, 2011]  ATHENS, Greece (AP) -- Greece's cash-strapped government promised Monday to raise an additional euro11.8 billion through 2013, with a crackdown on tax evasion.

Finance Minister George Papaconstantinou announced the measures a year after his country was granted an international bailout loan package worth euro110 billion from the European Union and International Monetary Fund to rescue it from the brink of default.

Papaconstantinou said Greece was in talks with Swiss authorities to monitor Greek deposits -- toward reaching an agreement similar to one existing between Britain and Switzerland.

Other measures include creating a speedboat division of fraud inspectors, and appointing a former senior prosecutor who handled terrorism cases to assist with the tax collection effort.

Debt inspectors, due in Athens this week, have warned that Greece needs to improve its tax system to end a weak run in state revenues that is threatening the country's fiscal rescue program

"Tax evasion is a crime against the country," Papaconstantinou said, noting that the measures include tougher penalties for bribing tax officials, a radical reorganization of the tax-office structure, and increased use of online tax services.

"This is the first time ever that such a systematic effort has been undertaken," the minister said.

Greece's black economy is worth between 25 and 37 percent of the country's gross domestic product, according to estimates by the European Union and the Organisation for Economic Co-operation and Development.

[Associated Press]

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