If Poland Can Fix Tax Fraud, So Can Greece
Poland's government is rolling in it.
The idea that Greece can reduce its need for debt relief if it learns to collect taxes better is hardly a popular one. But another country with a big gap between expected and actually collected tax revenues, Poland, is showing how a determined government can tap this huge resource to great effect.
A European Union study published in September, 2016, showed Poland and Greece with very similar gaps in value added tax collection: In 2014, Poland collected 24 percent less VAT than was due according to the rules in effect, and Greece took in some 28 percent less. That gap was about twice the European Union average. In European countries, the VAT, similar to the U.S. sales tax, is one of the biggest sources of government revenue. Poland's shortfall was some 9.3 billion euros ($10.4 billion) in 2014, Greece's 4.9 billion, which amounts to 2 percent of economic output in each country.