Financial Times
October 11, 2011
A neat pile of bills, tax demands and credit card statements stands on a desk in a corner of Irini’s Athens home, witness to the hard times on which she has fallen.
Before Greece descended into crisis last year, the well-groomed divorcee in her late 50s made a comfortable but under-declared monthly income of €3,000-€4,000 arranging stylish church weddings for the children of friends and acquaintances. Since then client numbers have shrunk, and Irini struggles by on a €500 pension and the rent from two small apartments. She worries how she will pay taxes on income and property announced last month by the country’s cash-strapped government. “I have some savings, but I am also paying off credit card debt and now two new taxes as well,” she says. “I’m not sure I can handle it.”
Irini, who declines to give her second name, is among tens of thousands of middle-class Greeks braced for an unprecedented plunge in their living standards as the finance ministry scrabbles to meet budget targets by imposing new taxes and slashing public sector wages and pensions.
“They have caught up with people like me through the new property tax,” Irini says, referring to the widespread practice among Greece’s self-employed of declaring less than half their annual income.
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