Germany and 'Black' Money

Every month or two....the public TV news analysts up the topic of hiding money (profits) within Germany, and how much gets shipped out of the country.

So I noticed today via ARD (Channel One)....they went to an estimate.  You can't say it's reliable or non-reliable....but they estimate at a minimum....it's five billion Euro (7-billion US dollars).  The high end of this estimate?  Fifteen billion Euro. 

Why so much?  Well....taxation and the frustration of the individuals or companies over the current rates of taxation. 

You could have a plumber and renovation guy come over and look at the bathroom job that you have in mind (total re-make of the bathroom).  On the books and legit, he might be talking about 12,000 Euro for all the work and materials.  However, if you remarked that you had some cash, and would accept a non-receipt situation....he might come back and suggest that he'd do it for 10,000 Euro. 

A decade ago, I had a mechanic who did regular work for my cars, and he commented one day that if I'd just pay in cash (no receipt)....he'd take 10-percent off the bill. 

How much of this goes on?  It's hard for companies like Siemens or BMW to hide money, and I doubt if you'd ever find a situation where the authorities come in to investigate them.  I would suggest that it's more of the smaller companies (bakery shops, ice cream shops, plumbers, window-installation people, etc).

How would you go and hide the money?  I'll give you an example.  There was a syndicate of Germans (probably having one central lawyer helping to make this happen) who found that you could go and form a company in Cyprus, without a lot of identification of members, and then go use the company to go and buy Greek freighters or ferries.  The profits?  It'd roll back to the Greek company, which then transferred over to the Cyprus company, and then they'd reinvest their money into more ferries. 

Fake companies in Bulgaria and Romania?  There are probably hundreds of companies which lead around to a second fake company in Italy or Slovakia, which then lead onto another shell company somewhere else. 

Anger brewing over this?  The politicians are at a point where they can't really compete or resolve this mess without massive regulation in place and hindering everyday business.  The hostility of taxation?  You can walk into any German pub and start a conversation over taxes, and everyone has a fairly negative slant on taxation.  They all agree....you need some state effort to produce roads, schools, and fire/police.  But then they start talking about dumping 'grounds' where thousands and millions go....without any real pay-back to the general public.  They all feel screwed on taxation. 

So I leave you with this.  A country of 82-million residents.....producing 15-billion a year in black money and hidden outside of Germany....and in ten years....it's 150-billion Euro.  It's a huge amount to be hidden.