With the new year underway, the tax department is moving to apply a tougher enforcement framework, as tax reform measures aimed at improving compliance and collectability take effect.

According to the legislation approved by parliament and published in the Official Gazette of the Republic, authorities concluded that existing enforcement tools were no longer sufficient to meet the needs of the economy or taxpayers.

The restructured framework, therefore, introduces more targeted and immediate measures, while seeking to operate with greater flexibility and fairness.

Among the most significant changes is the introduction of temporary business closures in cases of persistent non-compliance.

Under the new framework, a tax inspector may suspend a business’s operations and seal its premises where the owner fails to submit two income tax returns, at least twelve monthly withholding statements or at least three VAT returns, provided these failures occur on or after January 1, 2027.

The delayed start date effectively gives taxpayers additional time to regularise their obligations.

Beyond non-submission, the measure may also be applied where taxes declared but unpaid exceed €20,000, including surcharges and penalties.

This applies once all administrative and judicial appeal deadlines have expired or, where challenges have been lodged, once all relevant procedures have been concluded.

The legislation further allows for the suspension of operations where a business fails to issue required invoices or receipts, issues inaccurate documentation or obstructs tax audits. In all cases, however, the closure of premises may not exceed ten days.

Before any closure is enforced, the tax inspector must follow a three-stage notification process.

Three warnings are issued to the business owner or operator, either by double-registered letter or by posting notices at the premises. The first notice allows ten days for compliance, followed by a second notice granting a further ten days.

A third notice then follows, inviting the taxpayer to submit written representations within five days.

Once this process is completed, the tax inspector may issue a formal decision to suspend the business’s operations, specifying the exact time of execution.

The decision must be served immediately or, where this is not possible, posted in a visible location at the business. Police assistance may be requested, while a tape indicating the tax department and the period of suspension, in Greek and English, will be placed at the entrance.

The decision takes effect from the date of its publication in the Official Gazette.

Anyone who violates the suspension commits a criminal offence and, if convicted, faces up to two years’ imprisonment, a fine of up to €30,000, or both.

Any legal challenge does not suspend either the obligation to comply or the Commissioner’s powers to proceed with collection measures.

Alongside business closures, the reform also introduces the freezing of company shares in cases of substantial unpaid tax liabilities.

A freeze may be placed on company shares where tax debts exceed €100,000 and remain unpaid for more than 30 days after becoming due. The measure does not apply to amounts that are not yet payable, are being settled in instalments, have been secured, or are subject to waiver or cancellation.

Under the new framework, the tax commissioner may freeze shares of legal entities with a value of up to twice the amount of the tax due, including interest and charges.

Before proceeding, the commissioner must notify the affected party in writing, setting out the reasons for the intended action and allowing 30 days for representations.

Once registered with the registrar of companies, the share freeze prevents the transfer of shares for its duration and operates as a safeguard for the payment of the tax due.

The registrar is required to notify the affected party immediately after registration.

The legislation also preserves the right to apply to the court for the lifting of the share freeze.

Where a court decision is issued in the taxpayer’s favour, the tax commissioner must notify the registrar within 15 days for the registration to be withdrawn.