Greek Tax Cheats
As the European Union struggles to find an answer to the dire financial situation in Greece, we here at the Five Dumbest Lab have a simple plan to alleviate the Greek people's suffering: Pay your freaking taxes!
If Greece wants to fix its budget deficit, it doesn't need an IMF bailout or a German boot to its collective behind. What the Greek government needs to do is crack down on tax evaders. According to The Wall Street Journal, tax evasion costs the country an estimated 15 billion euros ($20.5 billion) a year.
The big trouble, as the Journal points out, is that Greeks are not very good at paying taxes. In fact, they positively stink at it.
"It is not possible for a taxpayer to declare an income of 15,000 euros, while at the same time maintaining a big house, a big car, a recreational boat and sending his kids to private school," said Greek Finance Minister George Papaconstantinou at a news conference in Athens on Tuesday.
To quote the great Greek philosopher Aristotle, "No duh!"
The Greek shadow economy, which is made up of unreported income, was 25.1% of gross domestic product in 2007, according to a Journal source. Close behind, their fellow PIGS — Portugal, Italy and Spain — maintain shadow economies around 20% of GDP. By comparison, France and U.S. scofflaws make up 11.8% and 7.2% of their respective economies.
Papaconstantinou's new austerity measures include a higher marginal tax rate of 38% on people earning more than 40,000 euros a year, up from about 25%. Furthermore, the Greek government plans to close dozens of tax loopholes and eliminate special rebates to raise money.
Here's our question: What is 38% of nothing?
Ah, the Socratic method. You just can't beat it.
Dumb-o-meter score: 95 -- The Greeks don't need a bailout, they need a nationwide audit.