Non-registered businesses cannot count on state support

The Government program of economic support measures stands as major support to businesses in maintaining their operations and jobs during the crisis, but the non-registered businesses will not be eligible for the support. According to NALED estimates, there are nearly 70,000 such businesses, and their workers are the most affected, it was estimated at the first online press conference organized by NALED, presenting the results of citizens' opinion survey on shadow economy. 

NALED's new survey, performed by Ipsos with the support of German Development Cooperation, has shown that a half of citizens find that shadow economy is the most common in the field of labor - involving non-registered workers, salary payments made in cash, and non-paid contributions. However, 59% respondents would not report an employer to the inspection, mostly out of fear of losing their job. 

Citizens' awareness on shadow economy has been growing year by year, and even 76% respondents see it as non-justified, but they are still not enough ready to contribute to its countering. Since this year marks the completion of the five-year National Program for Countering Shadow Economy, the survey results will be important for the strategic document's revision, particularly in terms of the effects the pandemic will have on the economy.

- Up until the state of emergency, 50% of measures have been implemented or ongoing, with another 12% partially realized. Highlighting the priorities for the new National Program, businesses have indicated further reduction of tax burden on labor and amendments to labor legislation so as to recognize more flexible forms of labor, the development of eInvoice system, further capacity building of inspections, as well as the digitalization of the fiscalization system. The pandemic has shown that these measures are necessary in order to make businesses more efficient, competitive and resilient, and reduce the shadow zone operations - said Vladimir Tipsarević, the President of NALED's Fair Competition Alliance and Head of Public Affairs and Communications in Coca Cola HBC Serbia.

51% respondents believe the scope of shadow economy scope has been reduced over the past year, seeing the Market Inspection as the most deserving for this result. The conference highlighted that public campaigns are important in stimulating citizens to action, which is confirmed by 48% respondents, as well as education, particularly among students, which leads to new generations showing higher level of tax culture. 

- Encouraging entrepreneurship is also an efficient manner of countering shadow economy and we are therefore happy with the results showing that a quarter of citizens would gladly start their own businesses, with 68% being aware of the incentive measures such as the tax exemption for new businesses Start Legally, which is a program we have jointly worked on with the Government of Serbia and NALED. Nearly 75% of respondents believe that such measures can help in having non-registered businesses transitioning to legal flows – said David Lahl, Project Leader for the "Public Finance Reform – Agenda 2030" project implemented by GIZ.

Nearly a half of citizens (48%) believe that taking fiscal receipts is the most efficient manner for them to contribute in countering shadow economy, but even 71% would not report a facility which fails to issue a fiscal receipt for a product or service they received. Citizens have indicated that they least commonly receive a fiscal receipt at hairdressers and car mechanic shops, while retailers are seen as the most thorough. 53% citizens also added a view that all retail spots should be fiscalized.

Cashless payments as efficient manner of countering shadow economy are increasingly used. The use of payment cards has been increased by 8% and one in two respondents are using cards as easier method of payment. A third has heard about the option of making cashless payments at POS terminals in public administration, thanks to the campaign „Cashless Payments Champions" which generated 13,500 payments of fees, charges and taxes. 

The press conference presenting the survey can be viewed below.

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