The Fight against Undeclared Work: Sanctions and Incentives

Abstract

The present elaboration is dedicated to problem of tackling undeclared work. Sanctions and incentives that can diminish the scope of the grey economy are introduced and analysed. The negative effects of undeclared work and challenges for both European Union and Member States are presented. Among the sanctions, the author focuses on civil, criminal and administrative measures. The possible incentives contain fiscal allowances, appropriate legal frameworks, training opportunities, and are capable of transforming undeclared work into formal employment. In the author's view, an integrated approach and a comprehensive targeted strategy are indispensable, while priority should be given to incentives. Tackling undeclared work should involve the concerted action of all key labour market actors.

Experiences, causes and measures to tackle institutional incongruence and informal economic activity in South-East Europe

“…How governments can best tackle informal economic activity is the subject of increasing attention (see for example Barsoum, 2015; Mitrus, 2014; Williams and Horodnic, 2016). Williams (2014) provides a useful conceptual framework for classifying available policy measures for tackling the informal economy, identifying five potential overarching policy choices available to governments.…”

Tax evasion through unreported employment: Empirical evidence from the Republic of Serbia

“…Research in this paper adds to some, primarily foreign, modern research on informal employment (Merikull & Staehr, 2010;Mitrus, 2014;Lehmann, 2015;Horodnic et al, 2020). Although ever-present problem, the unreported employment is not sufficiently studied in transition and post-transition countries (Lehmann, 2015).…”

“…Further, they argue that unreported employees do not have health insurance either for themselves or their family members, social insurance, any legal security and protection; they could not contract a housing loan and would not have a pension. Unreported employment also results in unfair competition among companies (Mitrus, 2014).…”