Grey Economy 2016 describes the grey economy and the combatting against it in Finland

Tax Administration Bulletin, 11/22/2016

Finnish Tax Administration’s publication "Grey Economy 2016" gives an overview of how grey economy is fought against and how public funds are protected from it.

A strategy and an action plan are in place
In spring 2016, the Finnish government adopted a resolution outlining the national strategy and plan of action for 2016–2020 for tackling the shadow economy.

- Four spearhead programs are included in the strategy. The objectives are to promote healthy competition between business companies and safeguard market efficiency, to use proactive intervention in order to prevent the grey economy, and to influence people's attitudes and awareness. The programs help improve the exchange of information across administrative sectors, offer access to relevant information and more effective crime prevention, Director JanneMarttinen from the Grey Economy Information Unit (at Finnish Tax Administration) explains.

- We must regard the shadow economy as an important distortion of the competitive market in many sectors of business. Reducing its size will increase not only Finland’s competitiveness but also our attractiveness as a good investment destination and a reliable investor."

The rights of the employee and consumer are linked to the combat  
Many of Finland's public authorities aim to safeguard the employee's rights and consequently prevent the grey economy. Research is in progress in Finnish universities and the Institute for Occupational Health in order to study the circumstances of employees. The Grey Economy publication gives an overview of the latest results of the research that focuses on infringements against the rules on work safety. It also discusses the protection of the Finnish consumer, describing how requiring an operating licence in certain business sectors and the checking of the financial standing of the operators may help protect consumers' rights.

Combat against the grey economy extends itself to many sectors
The publication shows how the recent legislative amendments and anti-fraud programs serve the objective of grey economy prevention.

- A recent improvement of the control work in the construction sector is based on site visits, carried out in cooperation by work-safety inspectors and the police.  Serious problems were revealed in connection with the specific tax control program targeting taxi operators, as more than 30 percent of the audit results indicated the presence of some form of grey economy. Cases involving VAT refund fraud and attempted fraud have kept the authorities, especially the Tax Administration, quite busy during the early months of 2016.  Recent attempts by fraudsters have also involved identity thefts in which the perpetrators have taken advantage of the identity codes of reputable companies.

Grey Economy 2016 is available for downloading

Additional information: Articles published by the Grey Economy Information Unit’s experts (in Finnish)