Fuel smuggling remains rampant, monitoring missing

Illicit fuel trade has remained rampant seven years after legislation introducing an “inflow-outflow”data monitoring system for petrol stations, intended to enable the finance ministry to track purchases and sales in the sector.

The Syriza-led coalition, elected in January, 2015, had stressed it would wipe out fuel smuggling practices and generate increased fuel tax revenues, but this objective has utterly failed.

Since the bill’s introduction, the private and public sectors have spent over 100 million euros for the measure’s various requirements, while numerous committees and sub-committees have been assembled to address related issues, all to no avail so far.

Fuel smuggling has remained unaffected as the Greek State has ratified laws but failed to fully enforce them. The ineffectiveness of the “inflow-outflow”data, which has cost petrol station owners and the public sector close to 95 million euros to set up, is a glaring example of this failure.

It remains a mystery as to why the “inflow-outflow”data system is not yet fully functional despite having been installed at 99 percent of petrol stations, as was pointed out by Yiannis Aligizakis, president of SEEPE, the Hellenic Petroleum Marketing Companies Association, at a recent industry event. Incoming data is not being processed or utilized at the finance ministry.

Making matters worse, a study conducted by the National Technical University (NTUA) and whose results were released this week, showed that roughly fifteen percent of petrol stations are undersupplying customers at the pump, based on what they are charged, compared to four percent four years ago. These discrepancies are being picked up by the “inflow-outflow”data system but it is believed ministry officials are not processing the data.

As a result, the Greek State is being deprived of fuel tax revenues estimated at between 250 million and 300 million euros per year. Also, unfair competition is being supported as a result of the higher business costs burdening law-abiding enterprises.

Rather than clamp down on fuel smugglers, the government is instead preparing to introduce a new round of tax fuel hikes in an effort to raise roughly 492 million euros in fuel tax revenues next year.

Big questions need to be asked as to why illicit fuel trade remains evasive in Greece.