Der Spiegel article highlights low, low taxes paid by Greek shipowners

According to the article reported on in Greek by Deutsche Welle, Greek ship owners are continually expanding their fleets, clearly untroubled by the the economic crisis. In the first few weeks of 2014 alone the ship owners spent approximately 5 billion euros on new and used ships. In 2012 they spent 10 billion euros on the construction of 275 new ships and the modernization of their fleets.

According to Theodoros Veniamis, President of the Union of Greek Shipowners quoted in the article these ships were paid for by “money from our own pockets”.

The Der Spiegel article identifies the incredibly low tax rates on the shipowners as one of the main factors contributing to the near bottomless pockets the sector can draw on, in stark contrast to the rest of the Greek economy.

This continual expansion contributed to Greek shipowners recently topping international shipping rankings with greater capacity than their German, Japanese or South Korean rivals. But despite their success they appear unwilling to shoulder their fair share of the tax burden and help the Greek state emerge from its fiscal crisis.

Citing international studies, the article maintains that since 2002 at least 140 billion euros made by the shipowners has gone completely untaxed. It also notes that thanks to 58 different special measures written into Greek law for the benefit of the shipowners, the 800-odd Greek families at the head of the industry pay hardly any tax in relation to their wealth.

In no other country, according to Der Spiegel, are shipowners as protected as they are in Greece – even following years of austerity that have seen huge tax hikes on nearly every other part of the Greek economy.

It should also be noted that that of the 275 ships commissioned by the shipowners in 2012, not one order was placed with a Greek shipyard where the shipbuilding industry has effectively collapsed.

Veniamis is quoted in the article as rejecting the notion that the wealthy Greek shipowners do not pay their fair share, saying that they pay taxes as individuals ‘like everybody else.' 

But that assertion is difficult to square with the data from Greek trade unions cited in the Der Spiegel article which shows that as individuals Greek shipowners paid only a total of 15 million euros in taxes in 2012, while over the same period Greek sailors paid a total of 55 million euros.

For years Greek governments have faced criticism over their favourable treatment of the sector, apparently unwilling to anger the powerful group. The ‘gift-giving’ has continued even as the rest of the country continues to suffer under austerity.

Many ship-owning families control influential media outlets in Greece and are seen as being at the heart of the system of ‘diaploki’ – the ‘intertwining’ of business and political interests. Greek shipowners have also repeatedly threatened to move their businesses abroad if they are made subject to additional taxation.

Recently in the face of rising anger the shipowners have come to an agreement with the government over a ‘voluntary contribution’ for the next three years which will see the shipping companies pay twice the tonnage tax on their ships. However, as Der Spiegel notes, while the government claims this will give rise to a 140 million euro increase in revenue over two years, the shipowners put the figure at 100 million euros.