No more cash in realty buys

  • 7 months ago
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All purchases of property will soon have to be conducted exclusively via the banking system

The government aspires to bring an end to the phenomenon of bags of cash used for the payment of real estate purchases, as the state strives to contain tax evasion. All payments must be done via banks.

A regulation that will soon be submitted to Parliament will prohibit the use of cash, regardless of whether it is taxed and citizens keep it in their matresses, and of course whether it is money from illegal activities.

According to data from the National Economy and Finance Ministry, since March 2021, more than 84,000 real estate transfers have been carried out, which have been wholly or partially done in cash – i.e. outside the banking system.

In particular, there have been 42,613 real estate transfers with cash only, with a total value of 462.49 million euros and 41,741 transfers with a total value of €2.98 billion, with part of the amount paid in cash. In fact, in most of the above transfers the price on the contract does not exceed the amount of the taxable value. In total, transfers made entirely or partly in cash make up 24.9% of all transfers.

Now all transfers, at least for the amount of the “objective value,” will be done through the banking system. For amounts usually paid under the table that cannot be directly audited, the ministry and the tax office will carry out extensive audits and complex cross-checks (card payments, account checks, asset purchases etc) on contracts made at the level of the objective value.

A total of 338,511 property transfers have taken place since March 2021, with the total amount paid by buyers amounting to €27.74 billion.

Banning cash in real estate transactions is one of the measures to curb tax evasion. The economic staff announced eight more measures which will gradually come into force, while others have a more distant horizon, possibly to be realized by end-2024.

Regarding the self-employed, no measures are currently foreseen; however, Minister Kostis Hatzidakis noted that changes to the way professionals are taxed are under consideration.


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