Last week, I wrote a post on the influence of mafia firms in Italy. But criminal activities are peanuts in comparison to the size of the shadow economy, i.e. the economic activities in a country that are not reported to tax authorities or other government agencies. These are the plumbers who work on a cash-only basis and never report the revenue to the tax authorities, the consultants who report some project income but not others and the many small businesses who run two sets of books. In other words, these are legal economic activities that are performed under the radar screen of the government.
Measuring the shadow economy
Measuring the shadow economy
Measuring the shadow economy
Last week, I wrote a post on the influence of mafia firms in Italy. But criminal activities are peanuts in comparison to the size of the shadow economy, i.e. the economic activities in a country that are not reported to tax authorities or other government agencies. These are the plumbers who work on a cash-only basis and never report the revenue to the tax authorities, the consultants who report some project income but not others and the many small businesses who run two sets of books. In other words, these are legal economic activities that are performed under the radar screen of the government.