Licencing online gambling and using students, housekeepers and tourists as undercover tax agents are among the new ways Greece has promised the EU it will reform.
Greece made fresh promises to the European Union as it scrambled to find the cash to avoid going bankrupt. But European Union officials said the country’s left-wing Syriza government must do more before it could help with emergency funds.
In a letter to the 19 countries that use the euro published by the FT on Thursday, Greece’s Finance Minister Yanis Varoufakis said that large numbers of students, housekeepers and tourists could be hired and wired up as inspectors in an effort to address what he called a “culture of tax avoidance”.
Meanwhile specific internet gaming domains could be licenced for five years for an immediate payment of €3 million. He said licencing the sites could raise €500 million a year.
The letter is due to be seen by European finance ministers on Monday. Greece must convince every country in the Eurozone that it will reform before more funding can be made available.
Greece’s economy was bailed out five years ago in a deal worth €240 billion. The deal was meant to expire on 28 February. But the newly elected Syriza government managed to secure a four-month loan extension just before it hit the deadline.
To get the extension, Greece had to agree to a long list of reforms including a crackdown on tax evasion and smuggling of fuel and tobacco. The European Commission has rubber stamped the list, but individual countries now also have to agree.
If they don’t, Greece could once again face a crisis as Greek people, losing faith in the banking system, pull money from their accounts.
Tax revenues are down by €2 billion in January and February when compared with 2014. Tax avoidance is now widespread in Greece. Expecting their new left wing government to be more lenient, many people simply stopped paying tax.
Now some of the earlier loans need to be paid back. Greece must pay the International Monetary Fund €1.5 billion over the next two weeks. Three more instalments are due on March 13, 16 and 20.
On Friday, Greece scraped together €310 million for a partial loan repayment to the IMF.
The European Central Bank has blocked some of the more conventional ways for Greece to raise money to pay its debts. ECB President Mario Draghi refused to allow the Greek government to sell even more debt, in the form of treasury bills, to Greek banks. The EU and the IMF will not lift the €15 billion cap on T-bill issuance. This limit has already been reached.
Alex Tsipras, the Greek prime minister, said in an interview with a German magazine that the Eurozone had to assume responsibility for the consequences of holding back funding. “The ECB has still got a rope around our neck,” the Tsipras told Der Spiegel.
Additional reporting by ReutersReuse content