The tax audit mechanism is hunting down undeclared card terminals (POS) in a bid to uncover businesses concealing taxable income and bypassing the new online monitoring systems.
These businesses issue receipts that appear legitimate to customers, but the transactions are never transmitted to the Independent Authority for Public Revenue (AADE) through its electronic system, preventing tax authorities from tracing the real volume of commercial activity..
Although the interconnection of cash registers and POS systems has become one of the authorities’ most effective tools against tax evasion – helping generate more than €2.5 billion in additional state revenue – auditors are confronting a new and sophisticated form of fraud.
According to the authorities, the scheme involves undeclared point-of-sale terminals linked to foreign banks and payment providers, allowing transactions to remain invisible to the Greek tax office while funds are funneled outside the domestic banking system.
Audits that are already underway, and are expected to intensify over the summer, have revealed thousands of undeclared POSs connected to foreign banks and providers. Through these POSs, money from transactions does not end up in Greek business accounts, but in personal accounts business owners maintain in other countries.
According to information, some 80% of the undeclared POS that have been detected come from Bulgaria. At the same time, the authorities have recorded similar cases linked to Britain, Lithuania, Belgium and Ireland.
The tax authorities estimate that profits from undeclared transactions are initially deposited in foreign bank accounts and then repatriated outside the banking system, mainly via cash transfers.
Bulgaria seems to be the first country of choice for many businesspeople, mainly due to its proximity to Greece. Movements are easy and frequent, allowing more than one person (relatives, employees or partners) to transfer amounts of up to €10,000 each without having to declare them to the authorities.