Greece is moving to ban cash payments above €500, joining a growing number of European countries imposing restrictions on physical currency in efforts to combat tax evasion and financial crime.
According to Greek Reporter, the measure forms part of a broader tax bill requiring electronic payments for transactions at or exceeding the threshold, with doubled fines for violations.
The legislation marks a significant shift for Greece, a nation where cash has historically dominated economic transactions. Cash culture in Greece developed partly as a hedge against banking system instability, with citizens remembering the 2015 banking crisis and capital controls that restricted access to deposits.
The rationale centers squarely on tax evasion, a chronic problem that has plagued Greek public finances for decades. Estimates suggest the informal economy accounts for 20-25% of GDP, representing tens of billions of euros in lost tax revenue annually. Large cash transactions facilitate this shadow economy by making income and expenditures difficult for authorities to track.
The bill includes "stronger crypto oversight" provisions, addressing emerging payment methods that can circumvent traditional financial monitoring. As cryptocurrency adoption grows, governments across Europe are racing to close regulatory gaps that enable tax avoidance.
Similar measures exist throughout Europe, though limits vary considerably. France restricts cash payments above €1,000, Italy recently lowered its threshold to €1,000 from €3,000, and Spain prohibits cash transactions above €1,000. Sweden has taken the trend furthest, with many businesses refusing cash entirely in favor of electronic payments.
The arguments for such restrictions emphasize not just tax compliance but also money laundering prevention, corruption reduction, and tracking of illicit activities. Electronic transactions create audit trails that cash by definition cannot provide.
