Greece's tax revolution harnesses big data and drones to shake off a
legacy of crisis
[September 22, 2025] By
DEREK GATOPOULOS
ATHENS, Greece (AP) — With a pristine white exterior, the Greece tax
authority's new headquarters looks out of place on a clogged industrial
artery outside Athens. A former shopping mall and ice rink, the building
has been overhauled into an ultramodern digital center that has led the
rescue of the nation’s ailing finance and tax sector.
It is teeming with inspectors who chase down tax cheats with the help of
drones, big data and live surveillance feeds from as far as Greece’s
island ports and remote farming villages.
Analysts at the Independent Authority for Public Revenue monitor
millions of transactions in real time and order stings on businesses
flagged by algorithms for a high potential of illegal activity. The high
tech was on full display during a recent visit as The Associated Press
was granted rare access to the authority’s headquarters.
Greece’s tax system — once a byword for inefficiency — has been rewired
by technology.
Now, the country that spent nearly a decade as Europe’s financial
outcast, drowning in debt, has become one of its best budget performers,
with bonds restored to investment grade by all major ratings agencies.
“We worked systematically over the years, with dedication,” Giorgos
Pitsilis, governor of the revenue authority, told the AP. “We started
from a situation of no data to a situation with big data.”
From crisis to credit upgrades
Greece was one of just six EU member states that recorded a budget
surplus in 2024, after running deficits for decades. Momentum carried
into this year, with government revenues shooting past targets through
August.
Moody’s upgraded Greece’s bonds to investment grade in March, praising
its large-scale push to digitize the tax system. Jason Graffam, senior
vice president at ratings agency Morningstar DBRS, noted that Greece’s
long-term borrowing costs now sit slightly above Spain’s — and below
Italy’s and France’s.
“The Greece of today is indeed very different from a decade ago,”
Graffam said. “There has clearly been durable change to the country’s
economic model and its fiscal regime.”
During the crisis years, international creditors imposed punishing
austerity measures in exchange for three massive bailout packages.
Greece's population felt the pain deeply — wages were slashed, companies
shut down and the economy bled jobs.
Sustained pressure from lenders forced successive governments to
modernize one of Europe’s weakest tax systems.
Out went paper files and fax machines. In came cashless, paperless
systems powered by algorithms that scour card payments, tax filings,
payroll data, customs declarations and bank records – and flag anomalies
for inspectors to pursue.
'Saturday Night Fever'
Repurposed smartphones carried by inspectors in the field stream video
and audio back to headquarters. There are panic buttons to use when
someone feels threatened.
Back at headquarters, screens map ongoing site inspections and drone
surveillance feeds from multiple sites: from restaurants and ports to
hidden grain silos and fruit delivery trucks — even live readings from
ships’ fuel tanks.
Tax and customs officials described how the data translates into raids.
They spoke to the AP on condition of anonymity because of the
confidentiality of their work and citing reasons of personal safety.
During a recent nightclub sweep dubbed “Saturday Night Fever,” they
matched individual table orders against receipts to uncover undeclared
sales, mostly of alcoholic drinks.
“We knew the tables were full, but the receipts didn’t match," one
official said, adding that after inspectors showed up, the nightclub's
reported revenues doubled within days.
Fraud can be detected by cross-referencing mobile phone activity with
reported sales as recorded by cash registers and card-payment terminals
that by law must be connected to the tax authority.
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Inspectors of the Independent Authority for Public Revenue monitor
transactions in real time at the headquarters of AADE in Athens,
Greece, Tuesday, Sept. 16, 2025. (AP Photo/Petros Giannakouris)
 “If we detect signals from 20 phones
inside a store, but see almost no receipts, that’s a cue to dispatch
a team immediately,” another inspector explained.
High cost-of-living persists
The reforms have salvaged Greece’s reputation abroad. At home, the
windfall has funded 1.6 billion euros in tax cuts recently announced
by the center-right government.
Still, opposition parties argue that more efficient tax collection
does not offset policies that worsen inequality: The national sales
tax rate was hiked during the crisis to 24% — higher than most EU
countries.
It hasn’t been reduced since, while other austerity-era cuts remain
in place and poverty is stubbornly high.
The powerful Greek Communist Party described recent budget figures
as a “blood-stained surplus” that is eating further into the
spending power of wage earners.
But the revenue is a sorely needed boost for the government, which
is facing public anger over a corruption scandal and the
cost-of-living crisis.
Tax compliance may also — slowly and grudgingly – build trust in
public institutions, revenue agency officials say.
“It’s a powerful argument ... being tax responsible is beneficial,”
said Pitsilis, who has been governor since the tax agency became an
independent authority in 2017. “We earn more, and that gives space
for tax reform.”
Change is visible on the streets too. At a stall north of Athens,
Makis Panaretos sells watermelons, tomatoes, cucumbers and oranges.
About 70% of his sales are now electronic — all transactions are
instantly referred to the tax authority.
“Customers use their cards, phones and watches to pay," he said. "I
don’t mind it, even though it slows things down when there’s a
line.”
By November, all businesses will be required to accept IRIS, a Greek
instant payment system similar to Venmo in the United States,
eliminating bank and payment provider fees currently incurred by
vendors like Panaretos.
Deeper AI integration
Greece’s progress is an example how a crisis can accelerate reforms,
observers say.
"Greece has shown how digitalization and institutional independence
can translate into real fiscal gains,” said Alexandros Kentikelenis,
a political economy professor at Bocconi University in Milan.
Further integration of artificial intelligence into the tax
authority's systems through 2026 is likely to accelerate this
process, according to tax officials.
“The push to modernize tax administration continues, which supports
our expectation that tax revenue growth will remain robust over the
medium term,” Moody’s wrote in its report accompanying its ratings
upgrade in March.
Finance Minister Kyriakos Pierrakakis, a Harvard- and MIT-trained
technocrat, says the shift is irreversible. A supporter of the
digital euro, he has tied tax reform to broader plans to digitize
the economy.
“Countries change when they change course," he said at a news
conference this month. "And that change means we won’t be left
behind or ever return to the past.”
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