European Debt Crisis

The Greek voters' unlikely darling: Their taxman

The most unpopular man in Greece appears to have won enough votes to become a new member of the debt ridden country's parliament.

Greek tax collector takes up politics
Greek tax collector takes up politics

Greece's former chief tax collector, Harry Theoharis, ran on the ticket of a new party called To Potami, or "The River." Despite the country's national notoriety for evading taxes, early indications are that many Greeks voted for the man who was their main collector. The candidate and other Greek election-watchers expect vote tallies to confirm his election in the coming day.

He isn't surprised. "Many people have seen the kind of progress we've made," Theoharis said. "They actually appreciate the work that we did."

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Theoharis was named head of the Greek equivalent of the Internal Revenue Service in 2013, but then departed abruptly last summer, only 17 months into his 5-year term.

The reason for Theoharis' departure is the subject of intense speculation in Greece. Theories range from him being fired for being too aggressive with wealthy tax-evaders to refusing to delay tax bills until after the election, to refusing to hire government-favored appointees.

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Whatever the reason, Theoharis told CNBC that leaving the job was his decision. He acknowledged that he frequently faced political pressure, which he at first fended off before he "decided that it was getting very difficult to actually defend our position, effecting our first priority: our effectiveness."

The most recent review of Greece by the International Monetary Fund specifically noted that there was still too much political interference in the country's tax office. Reports at the time said Greece's international creditors were angry about Theoharis' departure.

People read newspaper headlines in Athens, January 26, 2015.
Louisa Gouliamaki | AFP | Getty Images

The IMF report also said that tax evasion is "still rampant" among the wealthy and sole proprietors—lawyers, doctors, and the like.

Theoharis campaigned on his efforts to improve the tax collection office. A former IT manager for Lehman Brothers in London, Theoharis says he reduced the complexity of the tax code, streamlined the office, improved its technology, and made audits more effective.

Tax evasion as a national sport

Why are the Greeks so famous for not paying their taxes? He says the complexity of the Greek tax system led many to "justify" not paying taxes. Additionally, because the office was so ineffective in the past, it led to much higher rates for those who did pay.

During the Greek financial crisis, some Greek commercial enterprises were in a a situation where "high taxes for some businesses means a choice between shutting down or not paying taxes."

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Moreover, he said, government services are generally bad, meaning people don't feel like they are getting their money's worth.

"In areas like education, healthcare, there is a poor level of service," he said. "Many see tax evasion as justified because "I'm not getting anything in return, so I'm not going to pay."