Greek dep. minister points to 'shell companies' opening in neighboring countries to avoid tax regime, red tape

Thursday, 05 October 2017 12:05

The government and tax bureau believe that eight out of 10 businesses controlled by Greek interests in neighboring countries are "clearly shell companies", deputy finance minister Ekaterini Papantsiou said recently during an event in the northern city of Thessaloniki.

The deputy minister said the specific companies are merely an attempt to avoid Greece's (very high) tax regime, featuring only "a (local) tax code number, a stamp, ... without transferring even a small portion of their (commercial) activity to neighboring countries... without personnel and without any real presence."

Papantsiou was referring to a long-held belief in the country, which is backed up by certain figures, of hundreds of Greek businesses "exported" to neighboring countries with a more favorable tax and social security regime (i.e. Bulgaria, Cyprus etc). The deputy minister, an accountant by training, pointed to the well-known practise in recession-battered Greece of law firms and accounting offices advertising their services for opening a foreign "tax shelter" in a neighboring country.

Papantsiou lamented the fact that such "phantom companies", as she claimed, engage in "three-way" commercial transactions to avoid taxes and bypass still imposed capital controls in the country - one of the remaining byproducts of the Tsipras government's shambolic negotiations with creditors in the first half of 2015.

She also bemoaned the fact that Greek capital and entrepreneurs are using such companies in order to purchase high-end real estate overseas, luxury vehicles etc.