Global Tax Trends and Local Impact: The 20th Athens Tax Forum in Focus
By Alexandra Loli, PhD | Business Partners, Sep-Oct 2024

Innovation should be seen as a strategic investment and a key growth driver. At GSK Greece,we believe it is essential not only to perceive it as such but also to leverage it to strengthen the healthcare system by making it more resilient and responsive to the population’s current and future healthcare needs. In this context, Greece is a country of strategic importance to GSK as the entire local organization is dedicated to accelerating the transition toward a more sustainable, resilient, and inclusive healthcare environment for the benefit of patients.

Innovation should be seen as a strategic investment and a key growth driver

Despite the challenges the local healthcare system faced in the previous years, at GSK Greece, we remain committed to our growth strategy, which is based on research and innovation, and continue to further invest in the country through our, under development, portfolio of vaccines and medicines and by adding value to both the Greek patients and economy. As far as the latter is concerned, we are particularly proud that we managed, just within the last three years, since 2021, to establish Greece as a reference country in conducting clinical trials. As of January 2024, we have an independent and rapidly growing clinical studies department, staffed by approximately 20 employees, thus ensuring that the majority, if not all, of GSK’s global clinical trials may be conducted in Greece.

Finally, at GSK Greece, being driven by innovation, we strongly believe that prevention, through vaccination, as one of the most effective public health interventions, is a low cost, high return investment, which should have a dominant place on the health policy agenda, with the ultimate objective of developing a strong national action plan for life-course vaccination, especially for adults and older adults, given the rapidly increasing ageing of the population and the pressure that these two demographics exert on the healthcare system.

In recent years, we have seen significant changes in the international economic and tax environment. Tax compliance has become increasingly challenging for multinational enterprises, especially in relation to cross-border transactions, and as a result, the need for efficient dispute resolution methods is at the forefront. 

Globally, the current trends of tax dispute resolution focus on pre-audit mechanisms as well as post-audit alternative mechanisms. The use of advance pricing agreements (APAs) is undeniably the most effective pre-audit mechanism available for resolving transfer pricing issues; we also now see an expanded use of AI by the tax administration in identifying tax issues and enhancing settlement communications with the taxpayers.

Post-audit, locally introduced procedures, such as the administrative appeals before the Directorate for Dispute Resolution as well as international tax cooperation settlement mechanisms including the use of the Mutual Agreement Procedure (MAP), offer consistent and fair resolution of tax disputes for multinational enterprises. The use of these mechanisms results in a more amicable and efficient way to resolve tax disputes, minimizing time investment and costs compared to litigation. We do see, however, that despite the advantages of such mechanisms, their use is still not as extensive. Finally, we are awaiting to see in practice the use of arbitration as implemented according to the EU’s Dispute Resolution Directive.

Tax compliance has become increasingly challenging for MNEs, and as a result, the need for efficient dispute resolution methods is at the forefront

In aspiration to a broader use of alternative dispute resolution methods, tax authorities should offer stronger incentives for the use of such methods while also using technological developments and AI as preventive measures to avoid dispute escalation and as a means of faster dispute resolution, enhancing compliance and efficiency within tax systems.

Digital transformation within a rather volatile tax regime, in conjunction with the ongoing and multifaceted legislative updates, presents a challenge in its own merit. However, as with every challenge, a great opportunity arises for Greece to transform and digitalize its quite bureaucratic environment.

Further support is required for companies that drive forward the transition to clean energy

The Greek government took significant steps forward during the pandemic, with the digitalization and automation of a substantial number of processes, most of which previously required the physical presence of the interested parties. Said steps have been widely recognized by the market as they improved efficiency. The implementation of mandatory e-bookkeeping for all companies through the Ministry of Finance’s MyDATA platform has been a stellar example, perceived as a major pillar in this digital transformation journey. 

This change generated major efficiencies and offered broader socioeconomic benefits. Companies are now able to reduce the time they spend on trivial processes such as reconciliations, issuance, and posting of invoices, while at the same time minimizing paper consumption, and can focus on value creation activities and improve their competitiveness. Major advantages associated with the transfer in real time of all issued documentation could largely address tax evasion and lead to a simplified and stable tax environment, protecting law-abiding companies from illicit competition.

E-invoicing, the decrease in the time of write-off of unaudited tax years (from five down to three), and the reduction of tax returns processing time in the renewable energy sector to 45 days are a few of the incentives that will surely create positive impact. However, while several new tax incentives have been introduced, we think that further support is required especially for companies that drive forward the transition to clean energy.

A series of measures such as access to financing at advantageous terms, a decrease of the effective tax rate for a specific time duration in case of mergers or company transformations, grants for new employment positions (including a decrease in employee/employer contributions), would create a more attractive economic landscape, boosting direct foreign investments, further minimizing unemployment and increasing salaries, and resulting eventually to a significant contribution in the country’s GDP.

Marking two decades as a leading platform for constructive dialogue at the forefront of the country’s taxation landscape, the 20th Athens Tax Forum stands out for the participation of outstanding, distinguished, and exacting delegates.

Organized by the AmCham Greece Taxation Committee, the conference is an interactive exercise in diagnostics that brings together specialists and experts to consider tax reforms and contribute to shaping them and enhancing their effectiveness. Particular emphasis is given to the importance and purpose of taxation and its significance to entrepreneurship, the investment environment, and the potential positive impact of digital transformation and AI at this crucial time for the country, as it bolsters the foundations of its economic self-determination, with clear goals and requirements, toward a reasonable, sustainable, and longterm fiscal surplus.

Amid the uncertain economic environment facing Europe and the world as a result of ongoing regional crises, particularly in our region, Greece continues to forge ahead steadily on its path of progress. The country is achieving higher growth rates compared to the European average, driven to a large extent by major development projects and the rapid pace of digitalization in financial and tax processes. These advances have, among other things, resulted in increased tax revenues and have simplified the daily lives of regular people. However, it is crucial to give appropriate emphasis and attention to the areas of development, public finance management, and business. The current economic climate has contributed significantly to revenue growth for publicly listed companies and to stronger business confidence in the economy. At the same time, modern tax policies are positioning Greece on a dynamic trajectory, with more advanced and comparable practices. Balancing these trends with the national economy ensures longterm and sustainable economic growth for the country.

Alternative dispute resolution (ADR) in taxation refers to methods used to resolve tax disputes without having to resort to traditional litigation. Typically, successful ADR models aim to reduce the backlog of tax courts (though the judiciary has the role of agreement guardian), lower the costs of resolving disputes, and maintain a constructive relationship between taxpayers and tax authorities. To this effect, nearly all stakeholders in tax systems have an interest in efficient ADR, which may include some form or a combination of mediation, arbitration, and conciliation.

ADR models can readily enhance efficiency in tax systems

Successful ADR models include the HMRC’s ADR process, where mediation is utilized as a means to resolve disputes, with trained mediators working with both the taxpayer and HMRC to reach an agreement. Similarly, the Australian Taxation Office uses a variety of ADR methods, including mediation and facilitated negotiation, to resolve disputes, while the IRS provides for an independent review of tax disputes through an appeal procedure where taxpayers can request a conference with an appeals officer to settle the case without litigation.

ADR models can readily enhance efficiency in tax systems by facilitating faster resolution of disputes, elimination of uncertainty, cost-saving procedures, and reducing the burden on taxpayers. Moreover, ADR methods can ensure quicker tax revenue collection, minimize financial and administrative costs of prolonged disputes, and improve overall awareness of the tax system as fair and efficient while altogether encouraging taxpayer compliance and fostering better relationships with taxpayers by promoting transparency, fairness, and collaboration rather than adversarial confrontations.

As Greece is primed to update to its 2.0 version, taking the jump to the digital economy, taxation should act as a catalyst for growth, helping attract more value-added investments. In the recent EY Attractiveness Survey Greece, 27% of global investors surveyed indicated reducing taxation as a top priority in order for the country to improve its attractiveness. To stay ahead of the curve during the ongoing global tax transformation, Greece should continue to introduce more tax certainty and predictability and establish a modern, pragmatic, and versatile tax system, investing in the power of technology, innovation, and people.

Geopolitical events, tax compliance, and controversy will play a pivotal role in shaping governmental tax policies in the near future. With taxes impacting all three elements of ESG, new tax opportunities are emerging in this field.

Despite global cooperation in combating tax evasion and avoidance, the rise of China as the new global power seems to be shifting the customs policies of the United States and Europe towards China. New tariffs and duties are raising imports and exports costs, as each side tries to retain or grow its market share. 

Climate change is a critical factor in the complex equation of taxation, as it increasingly requires more financial resources in order to address key issues and safeguard the future of humankind. 

Finally, the global high debt-to-GDP ratio threatens the global economy and is influencing government policies on tax collection. These trends will undoubtedly have a significant impact, affecting both businesses and individuals in Greece.

Alternative Dispute Resolution (ADR) methods, such as mediation, arbitration, Advance Pricing Agreements (APA), and Mutual Agreement Procedures (MAP), are essential tools for managing tax disputes and fostering cooperation between businesses and tax authorities. These mechanisms provide flexibility and efficiency, offering companies a way to proactively address tax uncertainties and ensure compliance without the need for more formal approaches.

ADR provides flexibility and efficiency, offering companies a way to proactively address tax uncertainties and ensure compliance  

The OECD strongly advocates for ADR in international tax matters, recognizing the value of procedures such as MAP, which facilitates collaboration between tax authorities in different jurisdictions to resolve cross-border disputes. APAs, on the other hand, allow businesses to negotiate pricing agreements in advance, helping to prevent future conflicts by clarifying tax expectations. These approaches are particularly useful for businesses whose boardrooms may find it challenging to navigate the complexities of tax laws.

Mediation within ADR encourages dialogue, ensuring that both taxpayers and tax authorities can work toward mutually acceptable solutions. Arbitration, meanwhile, offers a binding and predictable resolution, enhancing certainty in tax matters. By using a combination of these

On September 13, 2024, the Greek parliament enacted the new law on the Digital Transaction Fee, abolishing the former Stamp Duty Code, which was in force since 1931. The fee is imposed on transactions carried out or concluded from December 1, 2024, on, where at least one of the parties involved is a Greek tax resident or has a Greek permanent establishment, regardless of the place where the transaction is carried out or the place of the contract’s conclusion or execution or the type of the agreement. The rates are set at 0.30%, 1.20%, 2.40% and 3.60%. Α remarkable novelty is the €150,000 cap on the imposed digital transaction fee per loan agreement. Exemptions are extended to bond loans, concluded under Law 4548/2018, as well as loans granted to foreign permanent establishments. However, it appears that cash pooling agreements shall not be exempt. In addition, no fee is levied on the remunerations, paid by way of profit distribution to Board of Directors members and directors. The tax return must be submitted, and the fee must be remitted by the last day of the month following the month concerned, including all the transactions that took place during that month. The person liable to file the return and remit the fee is the recipient of the monetary provision or the beneficiary of such transactions, the Greek tax resident, if the counterparty is a foreign tax resident and, in any case, the legal person, if the counterparty is an individual.

Effective taxation is fundamental to economic growth and societal prosperity. It underpins sustainable development, inclusive society, and democracy itself. Fair and transparent tax policy can help foster a stronger trust-based relationship between taxpayers and the state, with far reaching impacts across areas, from doing business and attracting investments to the quality of everyday life.

For 20 years, the Athens Tax Forum has been contributing toward this. Bringing together policymakers, experts in tax, and other stakeholders to reflect on trends and developments in taxation in Greece and put forward proposals and suggestions for improving the Greek tax environment.

If the use of information technology in Greece aims at simplifying public bureaucracy and reducing the administrative costs for businesses, then Greece will have leveraged it correctly within the framework of the global economic system and the evolving digitalization of economies. However, if digitalization merely changes the form of bureaucracy from paper-based to digital, then Greece’s divergence from advanced countries remains.

Information technology should be prioritized according to the needs of citizens

If the transition of businesses to the new world of information technology is accompanied by increased administrative costs and occurs under conditions of compulsion, then it becomes an obstacle to economic growth. By ignoring the fact that all countries are developing by utilizing information technology and avoiding comparisons with them, we are simply turning a blind eye under the misleading impression that “everything is going well.”

The free public infrastructure for electronic invoicing in B2G transactions, as seen in countries such as Italy and Poland, and the development of free electronic invoicing applications for B2B, as in Spain, can become tools of actual economic enhancement, especially for the Greek economy, which primarily consists of very small or small family businesses. Officially imposing a distinction between domestic and foreign suppliers to the Greek government and placing domestic ones at a disadvantage is anything but a positive response to the challenge of information technology. Continuously promoting that, with the use of new technologies, the tax authority becomes stricter towards taxpayers, turning the use of information technology into a disincentive.

Innovation and development, by leveraging information technology, can only occur if businesses, the state, and society are in continuous communication and cooperation. In order to really become a powerful tool for Greece’s financial development, information technology should be prioritized according to the needs of its citizens.

Two facts are, probably, not to be disputed: First, tax disputes are still being resolved extremely slowly; as a result, businesses in particular remain trapped in protracted litigation and financial uncertainty, while on the other hand, the state is unable to collect valuable tax revenues in a timely manner. Secondly, in recent years, efforts have been made to speed up the resolution of tax disputes, with the introduction and development of the extrajudicial procedure, changes in the jurisdiction for resolving such disputes, as well as the reorganization of tax services and the automation of procedures. As these measures do not seem to have produced the desired results, the search for solutions continues. 

It is crucial to use all available means to avoid the generation of disputes

In this context, firstly, it is crucial to use all available means to avoid the generation of disputes, by targeted selection (using all digital means) of cases to be audited and by ensuring that legality is respected throughout the process. Furthermore, by providing other reasonable incentives to accept the results of the audit. Further, in addition to the appeals procedure, the debate on the activation of arbitration should be reopened in tax disputes as well, at least for disputes above a certain amount or on items where the direct resolution of the dispute is critical. Finally, the reallocation of the jurisdiction of the administrative courts is not sufficient: There is a need for further allocation of disputes to unilateral compositions (both of administrative courts and, possibly, to the Council of State), filtering (using also artificial intelligence) of cases, especially those on issues already resolved or apparently inadmissible or unfounded, selective out-of-court resolution for recurring issues, and full and timely compliance by the administration with existing case law. 

Hopefully, new targeted ideas as well as the available digital tools will assist in unburdening the volume of pending tax disputes and enhancing taxpayers’ confidence in the tax administration and tax justice.

The Independent Authority for Public Revenue is continuously evolving. By dynamically adopting innovative technologies and enhancing our services, we lay the foundations for a tax system that meets the demands of the 21st century. Our investment in operational expertise, artificial intelligence, and streamlined processes allows us to more effectively detect tax evasion and provide quality services to taxpayers, contributing to a more equitable tax environment. As we move forward, we remain dedicated to working with taxpayers and businesses to build a stronger, more prosperous economy.

We aimed for and achieved an increase in public revenue and support for society through economic growth and expansion, rather than perpetuating excessive taxation.

We will continue with the same strategy in the coming years, implementing a mix of tax policies that combine fiscal responsibility with social sensitivity. Our primary focus is on carrying out a comprehensive reform plan addressing tax evasion, enhancing citizens’ income, modernizing the banking system, facilitating easier access for businesses to alternative sources of financing, improving the business environment, and settling the debts of businesses and individuals through a comprehensive framework that protects compliant debtors.

At the same time, a key pillar of our strategy is providing incentives aimed at creating stronger and more competitive business formations. Strengthening transparency in transactions is also crucial, as is the development and use of advanced technology to detect and analyze financial data, cross-check information, foster international cooperation, and adopt international standards for monitoring cross-border transactions. Furthermore, we seek to raise awareness among citizens and businesses regarding their obligations as well as their rights.

With these principles and goals in mind, I welcome this milestone 20th edition of the Athens Tax Forum, which, through the participation of prominent speakers, the development of insights, and its written contributions, supports our country’s tax policy efforts in a constructive manner. We thank AmCham for this, and I wish the Tax Forum continued success for many years to come.

The 20th Athens Tax Forum comes at a crucial time as global tax trends continue to evolve, impacting both international and local economies. Key initiatives, such as the OECD’s BEPS 2.0 and global minimum tax rules, are reshaping the tax landscape, requiring businesses to navigate more complex regulatory frameworks. In Greece, these global shifts align with domestic tax reforms, influencing the country’s competitiveness and investment environment.

At Deloitte, we assist organizations by providing the expertise and strategic insights needed to respond effectively to these changes and prepare for the future of tax, where advancing technology will allow us to add value in our services.

Current developments and continuous progress in industries such as AI, green energy, and human capital investment highlight the imminent need for adaptation of tax policies to direct innovation and support these emerging industries toward a more sustainable global landscape. 

The key to encouraging longterm investments is the stability and predictability of tax policies

An effective tax reform would be the provision of incentives, such as enhanced tax credits or deductions, to enterprises investing in AI and green energy technologies, with emphasis on renewable energy infrastructure, as well as to those investing in workforce education and training in skills related to these industries or meeting specific ESG criteria. The government could also prioritize public funding toward R&D in these sectors, by providing subsidies and tax exemptions for R&D expenditure to a broader range of activities in green energy and AI. Public innovation funds could also be established to offer grants or low-interest loans to SMEs engaging in these industries. Furthermore, progressive corporate tax rates could be introduced as a reward to enterprises with positive contributions to social and environmental goals. Carbon or other environmental taxes could be introduced to further encourage environmentally friendly practices, with revenue allocated toward social programs or reinvested in green technology. 

Of course, the key to encouraging longterm investments in these industries is the stability and predictability of tax policies, as well as the international harmonization to prevent tax avoidance and ensure global competitiveness. The above indicatively mentioned reforms would effectively foster growth in AI, green energy, and human capital investment and ultimately contribute to sustainable economic development.

Greece is encountering both challenges and opportunities as it seeks to enhance tax efficiency while driving economic growth, particularly amid the ongoing digitalization of the economy, which is introducing new and more complex business models, and the shifting dynamics of global tax policies.

The rapid pace of technological advancement adds to the difficulty of defining and monitoring digital transactions for tax purposes. Nevertheless, Greece can further invest in digital tools, such as the myDATA platform, to improve its tax administration and expand its tax base through more targeted audits based on detailed risk analysis. This, however, imposes additional regulatory costs on taxpayers, requiring significant investments in IT resources as well as extra manhours.

By providing tax incentives for digital activities, Greece could stimulate economic growth and appeal to global talent and entrepreneurship, potentially transforming itself into a leading hub

Furthermore, Greece must explore the new rules pertaining to digital and international taxation, such as the upcoming digital levy in the EU and OECD’s Pillar 2 proposals. In this context, a delicate balance must be found between levying adequate taxes on multinational corporations and fostering an environment that attracts foreign investments and encourages startups to innovate. By providing a series of tax incentives for digital activities, Greece could harness the unique opportunity to stimulate economic growth and appeal to global talent and entrepreneurship, potentially transforming itself into a leading hub.

Greece should not lose pace with the rapid changes that digital technologies and the related tax policies introduce. There may be significant challenges in introducing fundamental tax reforms to regulate the new status quo and tackle tax evasion. However, these difficulties also open avenues for modernization and strategic growth.

In a world of geopolitical instability, amid the significant impact brought by climate change on businesses and societies worldwide, ESG has emerged to create value for societies through the conduct of responsible business in a transparent way. Tax is a constituent part of the S element of ESG as it is a source of giving back to society. 

In parallel, the AI revolution has shaken the world. Although challenges facing businesses are still undetermined, undoubtedly, incorporating the benefits brought by AI is in focus worldwide. 

State tax policies need to address substantial measures facilitating the challenges of the ESG and the AI transition; Greece should be in the frontline.

The cost of adapting to the new reality brought by ESG and AI is a fact that has to be addressed by state tax policy. Bold steps towards redrafting tax rules to incorporate ESG and AI aspects should be taken by tax legislators. At the same time, tax administrations should realize the necessity of incorporating these new rules into their concept and practices. What would seem appropriate for tax legislators and administrators is twofold: First, they must redetermine rules to reinforce the materialization of ESG targets; for example, ensuring the deductibility of increased costs that ESG brings, incentivizing further through tax super deductions, and recognizing the need to identify the most appropriate transfer pricing method by taking into consideration parameters such as ESG strategies and reporting will be much needed to allow MNEs to properly deploy ESG targets. Second, they must explore how AI can be leveraged by both state tax audits and businesses in order to tackle tax evasion while allowing for quick and cost-efficient compliance for taxpayers. Faster collection of taxes should lead to faster tax refunds. AI should also lead to an efficient implementation of fair taxation, which is part of ESG targets, by combining data and making it possible to determine the tax footprint of businesses in a more uncontestable and transparent way.

Last but not least, it is a matter of change of mindset for both the state and businesses and therefore requires proper education and target setting. Businesses are manifestly on track, by adopting relevant non mandatory reporting, showing their commitment to fair taxation, and giving back to society, among others. It is time that state policy is also confronted with the need to assist this transition. Greece cannot afford to lose the opportunity to integrate these aspects while modernizing its approach to taxation.

This year marks a significant anniversary for the Athens Tax Forum. Organized by the Taxation Committee of the American-Hellenic Chamber of Commerce, over the past 20 years, the conference has emerged as a leading institution in the Greek taxation landscape. It is a natural extension and culmination of the Taxation Committee’s work to promote new ideas, contribute to public dialogue, and support institutions in shaping tax policy. Bringing together an exceptional lineup of delegates year after year, it has built for itself an outstanding legacy and reputation as an event that generates fresh information, ideas, and proposals in all fields relating to business taxation. 

On the occasion of the forum’s 20th anniversary, I want to thank everyone whose invaluable contribution over the years helped establish the Athens Tax Forum as one of the country’s foremost tax conferences: our esteemed delegates and guests, our excellent audiences, our sponsors and partners, the members of the Taxation Committee, and of course, my predecessor, Taxation Committee founder Mr. Stavros Costas, who led this endeavor for its first 17 years. As we celebrate two decades of the Athens Tax Forum, I look forward to expanding on this legacy that we have built together and contributing to shaping our country’s new taxation landscape.