Regional Hidden Economy Forum


With the support of the Balkan Trust for Democracy and the Central European Initiative – CEI, the Center for Research and Policy Making (CRPM) from Macedonia, in cooperation with the Institute for Democracy and Mediation (IDM) from Albania and the Democracy for Development (D4D) from Kosovo, on the 6th of February, 2018 organized the Regional Hidden Economy Forum. The event aimed at bringing researchers and policy makers from the region to discuss the latest trends in measuring the hidden economy and transforming the findings into policies. At the same time, a comparative study on hidden economy was presented, which analyzes the spread and trends of hidden economic activities in Macedonia, Albania and Kosovo.
The results show that the countries of Southeast Europe face similar problems, such as undeclared wages and trade, leading to relatively high indices of hidden economies. It also suggests combining the repressive with incentive measures so that employers will be encouraged to declare their employees with their full amount of wages.
The event was opened by the director of the Macedonian Public Revenue Office, Sanja Lukarevska, who pointed out that the inspections are on the field on daily basis, citizens constantly report irregularities; however, non-issuing fiscal receipts and illegal operations of companies that are particularly well listed in the economic community are still present. She said that the measures specified in the study would be seriously considered, and the administration would boost inspections. Mr. Cerkin Dukolli, deputy minister of the Ministry of Labor and Social Welfare in Kosovo, stated that informal employment is a direct violation of the employee’s rights and that the Government has prioritized fighting informal economy, including informal employment.
The main researcher, Ana Mickovska Raleva, said that compared with 2014, Republic of Macedonia stagnated on the index for a hidden economy with a value of 3.4, but compared to other countries, the country stands better, having in mind that for Kosovo it is 6, and for Albania 4. Gersi Gashi, from the Democracy for Development Institute, stated that there is a need for a monitoring system that uses informal economy indexes and expedites tackling issues, and would enhance the inter-institutional cooperation, which is key to fighting informal economy.
One of the most renowned experts on the topic, Josip Franjic, said that the Croatian experience shows that after Croatia’s entry into the EU, the main problem remains the mistrust among Croatian citizens that paying taxes does not mean that the collected funds in the whole amount will be spent for the needs of the state and the citizens.
The forum also shared experiences from Kosovo and Albania on how their institutions deal with tax evasion.

The paper can be read here.