Shadow economy in Lithuania shrunk by 10 pct over decade, says minister

Source: Xinhua| 2019-09-04 02:28:12|Editor: huaxia
Video PlayerClose

VILNIUS, Sept. 3 (Xinhua) -- The size of the shadow economy in Lithuania has declined significantly over the last decade and paying taxes has become "fashionable", Lithuanian Minister of Finance Vilius Sapoka said on Tuesday.

"There are many ways to calculate that size of the shadow economy, but the trends are already clear. We can see that over the decade, the shadow economy in Lithuania shrank by 10 percent," said Sapoka at a conference in Vilnius.

In his words, the fact that VAT collection rose 8.5 percent last year, while consumption increased 6.3 percent shows that the shadow economy is shrinking.

"When I said earlier that paying taxes should become fashionable, many laughed. Now I believe it is fashionable and situation has changed," Sapoka was quoted as saying by local media.

At the conference, a new report on shadow economy conducted by Lithuanian Free Market Institute (LLRI), a think tank, was presented. The report is based on surveys conducted in six countries - Lithuania, Latvia, Estonia, Poland, Sweden and the Czech Republic - during March and April 2018.

"The fight against the shadow must first and foremost be aimed at reducing the burden on legal activities. Such measures serve a dual purpose: they encourage people to move from the shadow to legal activities and contribute to economic growth," Vytautas Zukauskas, vice president of LLRI, was quoted as saying in a statement released by the think tank.

The institute estimates that the size of the shadow market in Lithuania may amount to some 10 billion euros, or around 22 percent of the country's GDP. (one euro currently equals to 1.10 U.S. dollars) Enditem