Size and development of the shadow economy and of tax evasion within Poland and of its neighbouring countries from 2003 to 2013: some new facts

Abstract

In this paper the size and development of the shadow economy and of tax evasion within Poland and neighbouring countries (except for the Ukraine) are calculated over the period 2003 to 2010. The size and development of the shadow economies is also shown for 36 highly developed OECD countries. The average size of the shadow economy in 27 EU-Countries was 22.3% in 2003 and decreased to 18.4% (of official GDP) in 2013. We also consider the most important driving forces of the shadow economy in 38 OECD countries. The biggest ones are with 14.6% unemployment and self-employment, followed by tax morale with 14.5% and GDP growth with 14.3%. The proportion of tax evasion (accounting for indirect taxation and self-employment activities) was on average 4.2% (of official GDP) in Poland, 1.9% in Germany and 2.9% in the Czech Republic.