Week in Insights: The Cashless Future Is Coming From Greece

Curated by Daniel Xu

Digital transactions are swiftly catching up to cash exchanges. A cashless future seems inevitable, not just possible. The first move may have already been made by Greece, a country that has struggled with its fair share of economic challenges and tax evasion issues.

Greece’s government has attempted to curb tax evasion by banning cash for transactions exceeding 500 euros (about $540). The new policy took effect this year and includes steep fines of up to a doubling of the underlying transaction amount.

Simultaneously, Greece has moved toward a “point of sale everywhere” policy, ensuring that digital transactions generate a receipt for the purchaser and real-time data provided to the Independent Authority for Public Revenue. Assuming compliance and sufficient resources for enforcement, the policy can be expected to significantly enhance the efficiency and effectiveness of tax collection in the country.

The increased prevalence of digital transactions was at least partially driven by the Covid-19 pandemic. In a cashless future, we may look back on the long-term effects of the pandemic as being much more far-reaching than public health issues. It may be responsible for fundamentally altering the worldwide economy—and for leading to a permanent solution to a major source of tax fraud.

At Bloomberg Tax, we remain vigilant in monitoring how disparate countries are navigating the complexities of tax policy in an evolving global economy. Our commitment is to provide thorough analyses from top experts and to help you understand the implications of new policies and their potential to predict or guide changes on the horizon.

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Visitors at a beach in Alimos in Athens, on Jan. 7, 2023.

Photographer: Nick Paleologos/Bloomberg via Getty Images

State Insights

KPMG’s Daniel De Jong and Harley Duncan examine factors taxpayers should consider as the state fiscal policy landscape shifts in response to falling state tax revenue.

Jordan Goodman of HMB Law examines a state tax ballot measure pending before a California court that opponents say contains impermissable revisions and would disrupt how the state and localities impose taxes.

Federal Insights

A pair of Tax Court decisions involving microcaptive insurance failed to provide any guidance for how small businesses can use it properly amid more IRS scrutiny, Van Carlson of SRA 831(b) Admin says.

General counsel Peter Winders explains why Carlton Fields prohibits its lawyers from using generative AI to produce briefs, motion arguments, researched opinions, and other legal products.

EY and PwC’s new leaders face industrywide challenges—fewer accountants entering the profession, emergence of AI, and the overall relevance of auditing practices, Hofstra’s Jack Castonguay says.

Global Insights

The OECD’s latest report to simplify transfer pricing is complex and fails to confirm certain provisions, Imke Gerdes and Richard Fletcher of Baker McKenzie say.

DLA Piper’s Mike Patton explains why advance pricing agreements will continue to grow more popular despite their similarities to the International Compliance Assurance Program.

Covington’s Lauren Ann Ross analyzes advantages of the OECD International Compliance Assurance Program compared with advance pricing agreements and audit adjustments.

European Commission enforcement of Pillar Two rules for EU nations creates implementation challenges for countries and multinationals, PwC’s Will Morris, Giorgia Maffini, and Steven Kohart say.

Columnist Corner

Tourism boosts revenue in many economies, but also fuels harmful climate effects and social inequity, Andrew Leahey writes in his Technically Speaking column. Leahey argues that carefully designed tourism taxes backed by global collaboration could redirect a portion of tourism revenue toward lifting the most vulnerable populations out of poverty.

Career Moves

Mark Quiroz has joined FORVIS with the tax specialty practice as as a managing director focusing on tax transformation in Chicago.

Taylor J. Stuckey has been appointed chair of the trust and estates service group of Stites & Harbison.

Sonita M. Bennitt has joined Seward & Kissel as a partner with the tax group in New York.

Ryan Swope has been appointed national practice leader for loan review of FORVIS.

Michelle Canerday has joined Holland & Hart as a partner in the Denver office.

If you’re changing jobs or being promoted, email your submission to TaxMoves@bloombergindustry.com for consideration.

News Roundup

It’s been another busy week in tax news from state capitals to Washington. Here are some stories you might have missed from our Bloomberg Tax news team (login required).

• Most companies that use jets in business spend a lot to make sure they comply with the tax code, making the IRS’s warning shot last week about stepped-up auditing of their use unlikely to touch most of those traveling on corporate aircraft, tax practitioners said.
• Australia backs countries being able to choose whether or not to opt into the Organization for Economic Cooperation and Development’s new transfer pricing rules for incoming goods according to their own interests, tax officials have said.
• New York City’s top tax official said Wednesday his agency plans to publish draft regulations for its business corporation tax reform by the end of the year, with the goal of implementing the new rules in early 2025.
• The IRS said it expects to get hundreds of millions of dollars from high-income people who haven’t filed federal income tax returns under a new initiative in the agency’s fight to get the money it’s owed from wealthy taxpayers.

A couple sits by the East River bank in the Brooklyn borough of New York, on Feb. 3, 2024.

Photographer: Charly Triballeau/AFP via Getty Images

Tax Journals

(Bloomberg Tax login required)

Tax Management International Journal

High-net-worth individuals who are concerned about the proposed changes to the “non-dom” tax regime should review their options now, attorneys David Lesperance, Piers Master, and Melvin Warshaw say.

Tax Management Memorandum

With regard to credit default swaps within an affiliated group, a French appeals court’s decision and expert literature indicate that the pricing of guarantee fees relies not just on the credit quality of the borrower but also that of the counterparty, economist J. Harold McClure says.

Prohibited transaction exemption application procedural amendments may clarify many points but clearly add new informational requirements to ensure integrity of the applicant and interested parties as well as independence of fiduciaries, Michael Schloss and Stephen Wilkes of the Wagner Law Group say.

Our Team

We talk about tax a lot. But you would hear much more if you popped into one of our Teams meetings. Here’s a quick look at what some of us are watching, reading, and listening to this week.

Watching
Katharine Butler (Acquisitions Manager): I’ve been rewatching “Motherland,” a very funny sitcom about a group of ambitious middle-class London mothers—and one father.

Reading
Rebecca Baker (Editor-at-Large): “Spare,” the Prince Harry memoir. I’m only 70 pages in, but it’s clear that the loss of his mother at age 12 affected him in ways he’s just now beginning to understand.

Listening
Andrew Leahey (Columnist): Giuseppe Verdi’s “La Traviata"—specifically Richard Bonynge and the National Philharmonic Orchestra’s recording from 1981.

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