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Five per cent admit to working in the black economy, while only 29 per cent believe the risk of being found out by Hacienda or Social Security is high, says Eurobarometer
28.03.14 - 15:49 -
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One in every three Spanish people knows someone working illegally
The ministers of Hacienda, Cristóbal Montoro, and Employment, Fátima Báñez, at Congress. :: M. H. DE LEÓN
Five per cent admit to working in the black economy, while only 29 per cent believe the risk of being found out by Hacienda or Social Security is high, says Eurobarometer
One in three people in Spain openly admits that they know somebody who works in the so-called black economy, in other words without being registered with Social Security or paying tax on their earnings. It may seem a lot, but bearing in mind that at present there are a million undeclared jobs, according to the survey service of La Caixa, the proportion seems almost normal.
This means that we are talking about fraud in the labour market to the value of nearly eight per cent of the Gross Domestic Product (GDP).
However, according to the latest Eurobarometer survey, which has just been published for 2013, only five per cent of Spanish people interviewed admitted openly that they worked in the black economy, one per cent more than average in the European Union. When it comes to admitting to acquiring goods and services on the black market, that is, without an official invoice and, therefore, without paying IVA (value added tax), the proportion is about eight per cent and is below the norm among the rest of EU countries (11%).
In fact, that is the type of behaviour that is least criticised by people in general: when certain works are carried out privately and paid for with no invoice changing hands. Only seven out of every ten people asked (72%) said they found this “unacceptable”, although curiously the level of criticism of a company behaving in the same way was 87%.
Every Spanish person pays an average of 250 euros a year for this type of illegal work (50 euros more than the European average), which ranges from home improvements (33%) to car repairs (27%), domestic cleaners (11%) and food (7%).
When it comes to people not paying tax or only declaring part of their income, the criticism rises to 91%. Nevertheless, there is less criticism (88%) of companies that employ staff illegally, and this is also lower than disapproval of a company that subcontracts works with another without declaring it to Hacienda or Social Security (92%).
Growing disapproval
In the case of the most common irregular conduct, making payments without IVA and not declaring money received, nine out of every ten Spanish people surveyed said they disapproved. Most answers to the survey showed a high degree of opposition to everything to do with the black economy and even the criticism of those who travel on public transport without a ticket rose by 11 points (75%) compared with 2012. When asked what they thought were the chances of people who are working in the black economy being discovered by Hacienda or Social Security, barely 29 per cent believed there was a high risk and 58 per cent thought there was little chance of being found out.
The size of the black economy - figures apart - is demonstrated by the fact that at least 33 per cent of Spanish people say they know someone who works in this way, although this is only one per cent higher than the European average. Spain, however, is one of the EU countries where this percentage has grown most (by six points) during the crisis (2007-2013). The authors of the report attribute this to the recession and the high increase in unemployment.
The European countries where the highest percentage of people confess to working in the black economy are Latvia, Holland and Estonia (11%), Denmark (9%), Lithuania (8%), Sweden and Slovenia (7%). Spain is further down with 5% (the EU average is 3%).
If there is no choice... or if they could get away with it
According to the latest Eurobarometer, seven out of every ten Spanish people say they would accept a job in the black economy for two reasons. Some 45% (in other words almost half of those asked) would do so if they were unable to find a normal job, while just over a quarter of them (28%) say they would do so if they thought they would not be found out, because they like the idea of not having to give part of their income to Hacienda or Social Security. For 19%, the principal reason for working in the black economy would be the pressure of taxation and social charges, while 23% would opt for this system simply because they know they could earn more money.