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Hungary: Efforts to curb black economy advance

Banking

By a safe estimate, an extra Ft 50 billion ($281.7 million) tax income is being received due to stricter policies against the black economy. Annual tax payments are Ft 186 billion (1,05 billion) in excess of expectations (out of this, Ft 25 billion comes from inflation), according to the Ministry of Finance.

For comparison: estimated size of black economy is 18% of GDP, which results in annual Ft 2000 billion less tax payments. Controls in notably the construction and tourism industries have became very frequent, and more unregistered workers were found in the first 8 months (50,800), than in all the year of 2006 (approx. 42,000). Audits of private property also helped in curbing the black economy, and not only because of the Ft 20 billion extra tax income, but also because of the extra information provided by these procedures, and the further investigations they lead to. When coming across illegal operations, the tax department will frequently make estimates to calculate the amount of unpaid tax or VAT.(Napi Gazdaság)

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