UNDERGROUND ECONOMY AND THE TAX EVASION IN ROMANIA

Authors:
• Cristian Nicolae STANICA, email: stanica_cris@yahoo.com, Afiliation: Institute of Economic Forecast, Romanian Academy, Bucharest

Pages:
• 229|234
Keywords: underground economy, undeclared labour, tax evasion, degree of compliance
Abstract:
The paper present the features of the underground economy in Romania and the factors’ contribution to its formation: undeclared labour of the formal sector (enterprises), value added tax evasion, and the under-reported incomes of the small entrepreneurs’ sector (family associations and self-employed). The tax evasion for the main budget revenues is estimated starting from the NIS - based valuations of the underground economy. Annual reduction of the undeclared labour with 10% - 15% could provide the necessary budget revenue for the implementation of fiscal relaxation measures, such as reducing the flat tax or the employers' security contribution.

CCRP Conference