Warning: Spain Is On The Brink Of Financial Collapse Because Nobody Pays Taxes

Forget Greece ,Spain Is On The Brink Of Financial Collapse Because Nobody Pays Taxes…

Spain threatens the strength of the euro currency union far more than Greece, given the much larger economy. And it turns out that, just like Greece, Spain has a horrendous tax-dodging problem. Which means lost tax revenue the Government has to borrow money for.

For Spain, such tax shenanigans center around the property market where reportedly half of landlords evade taxes.

Bloomberg:

Owners are asking for payment in cash from tenants to avoid tax on 2.5 billion euros ($3.5 billion) of earnings annually, the Gestha union of tax inspectors estimates. An increase in rental properties nationwide hasn’t generated any more tax revenue.

The Spanish government, seeking to pull the country out of its deepest recession in 60 years, needs all the money it can get right now. The slump was triggered by a crash in the housing market and has left Spain with the highest budget deficit since at least 1980. Taxes go unpaid on income equal to about a quarter of gross domestic product, Gestha estimates.

…

Encinar, whose company lists 360,000 properties for rent and purchase, said Gestha’s estimate that 54 percent of landlords are ducking taxes “falls short of the true figure, which is set to grow further.”

http://www.businessinsider.com/no-wonder-spain-is-such-a-financial-disaster-nobody-pays-taxes-there-either-2010-2

Related Posts:

• Data shows “its a Great Depression”.
• Why people are buying?
• U.S. expects $1.2 trillion budget deficit in fiscal 2009 - Budget office sees recession lasting well into 2009, with slow recovery in 2010
• Economic outlook 2009-2012
• The bottom line: In less than one decade, investors who trusted Washington and Wall Street were fleeced to the tune of $22.1 TRILLION!

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