Europe’s economic crisis has been a powerful driver for many European governments to take measures against the shadow economy as they look to consolidate budgets and foster recovery, according to a report published by Visa Europe. In 2013, Europe’s shadow economy is set to be worth EUR2.1tr, or the equivalent of 18.5 %of Europe’s economic activity. While this signals a ten-year low for the shadow economy, the report shows that it is still a cash-based phenomenon across Europe driven predominantly by undeclared work and under-reporting.
Steve Perry, Commercial Director at Visa Europe said: “In times of down-turn, rising unemployment, lower disposable income and fears about the future tend to lure more individuals into ‘shadow activities’. While prior to 2009, the fight against the shadow economy was bearing fruit across all parts of Europe, recently different responses from Western, Southern and Eastern Europe have emerged which are having varying degrees of success. What is common to them all is that the shadow economy is still a cash-based phenomenon across Europe, which is driven by undeclared work and under-reporting.”
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