As a Business Owner, How Would Like to Pay a 24% Tax You Can’t Pass on to Customers?
I’m reporting from Athens, Greece. I recommend it. It’s a great place to visit. A couple of observations before I get to the subject of taxation. As you probably know, the national language of Greece is Greek. Nearly every person we spoke with who speaks Greek also speaks English. Some know several languages. They begin in elementary school. How many of us took a foreign language in high school and came away learning a few phrases but not being able to converse with a native speaker of that language? Too many.
If you have children, start them off early. There are numerous language programs available. The best way to learn a language is immersion. Make sure you get a program that teaches the language in a real-life setting. Involve the entire family.
Like any large city, the traffic is intense. Lots of motorcycles and unconventional driving. Our taxi driver – “the best in Athens” he told us – drove over a low median to get us back to the hotel. On the way, he took us to the site of the stadium where the first modern Olympics were held in 1896. He was kind enough to take our picture.
The thing that caught my attention was the amount of tax that was listed on the receipts we received when we ate lunch and dinner – 24 percent.
At the last place where we ate this evening (we’re six hours ahead), I asked if this was added to the bill. The proprietor said it was not. This is the tax that he had to pay. The customers were not charged.
He told my wife and me that he could not pass on the cost to customers because they would lose a lot of business. These establishments are eating the cost so they can eat, but consuming the cost is making it more difficult for them to eat.
You’re probably thinking, “They just told you that.” What made me question the tax was how old the menus were and cheap our bill was. There may be some places where the tax is added on, but not at the restaurants where we ate.
Greece is in trouble, much of it of its own making. Calls for cutting popular social benefit programs is meeting with resistance. Welcome to the club.
Greece has been trying to borrow its way out of the crisis. It can’t do it unless certain conditions are meant:
“The International Monetary Fund clashed with the Euro-creditors, warning that the overall program was not ‘credible.’ The IMF indicated that additional tax hikes and pension cuts were necessary to meet program metrics and for Greece to qualify for debt relief. While the European Commission predicted that ‘investment is expected to take off in 2017,’ the Fund concluded that growth prospects remain weak and subject to high downside risks.’”
Beware of the politician who tells you, “Just pass on the cost.” There comes a point when hikes in mandated minimum wages, strangling regulations, taxes, and the cost of “popular” programs can’t be passed on.
At one restaurant, we noticed that there were not that many employees. All the wait staff were hustling. It’s my guess that it’s the tax that is forcing them to cut staff and work extra hard.
As we’re seeing in several industries, ordering kiosks are being used to replace works. No salary. No complaints. No Social Security and Medicare taxes to pay. No insurance to pay. No lunch breaks. That’s why there’s talk about taxing robots.
It’s not much different in the United States. The people want stuff, and they want other people to pay for it. Politicians want to get reelected, so they promise more free stuff. The day of reckoning is about to become the day of wrecking if we don’t put an end to the tax and spend policies of both parties.
* The image of “The Running Man” is across the street from the Athens Hilton Hotel where we are staying.