Carrots to lure overseas funds

The government is hoping to secure fresh funds from Greek money deposited or invested abroad via a combination of incentives and crackdowns. Firstly, the Finance Ministry is reportedly examining a plan for the issuing of bonds exclusively directed to Greeks abroad, although no decisions have been made yet. If the plan is implemented, it will concern markets with a strong Greek presence, such as the United States, Canada and Australia, sources suggest. The idea is to appeal to the patriotic sentiments of the diaspora. Meanwhile, the ministry is further preparing to examine whether Greeks with bank accounts abroad are paying tax on interest earned and to establish the origin of the money deposited. The process of identifying Greeks’ overseas accounts has already been started by the General Secretariat for Information Systems (GSIS), which reportedly has a list of tens of thousands of Greeks with deposits abroad that are earning high rates of interest which could represent a source of revenues for the government in the form of taxes. A top ministry official suggested that even in cases where tax has been paid on the interest on overseas deposits, the origin and legitimacy of those funds are likely to be investigated due to the large amounts usually involved. To this end, GSIS has compiled two lists: The first will consist of those who have not paid taxes on interest earned and the second of those who have suspiciously large overseas bank accounts. It will not be investigating student accounts or those with small balances. It is clear that the purpose of these checks is to pressure foreign account holders into returning the capital to Greece. The relevant regulation provides incentives for the return of Greek capital to the country by waiving any checks on funds repatriated in return for a lower 5 percent tax, until October 15. What’s more, if the funds returned to Greece are invested in Greek bonds or in real estate, the tax due will be halved. Similar incentives given in the past have produced negligible results.

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