The proportion of shadow economy in Latvia can be as large as five billion euro, as estimated by SSE Riga Sustainable Business Centre researcher Arnis Sauka.
In a discussion organized by Nozare.lv, Director General of the State Revenue Service Inara Petersone was asked to estimate the proportion of shadow economy that was present in Latvia last year. She replied by saying SRS is not the institution that can accurately say how much money the state budget did not receive as a result of shadow economy. SRS can, however, analyse the numbers submitted in tax declarations.
‘Estimates of our research show that shadow economy is approximately 28.8% of GDP. Schneider was estimated at 25.5% of GDP. Both research undertakings have different methodology but similar results. Because of applied methods, results of the survey by Stockholm School of Economics in Riga are considered to be the lowest shadow economy threshold and that of Prof Schneider – the highest. With that, it can be concluded that Latvia’s shadow economy proportion may be around 24.5% of GDP. So if Latvia’s GDP is around EUR 20 billion, the shadow economy may be as high as EUR 5 billion,’ – says Sauka. (more)
Source: Baltic News Network
Read the whole story here: http://bnn-news.com/researcher-shadow-economy-possibly-costs-latvia-billion-euro-115296