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Almost 26 billion euros in tax goes uncollected.
Sixteen per cent of the Spanish economy is underground

Sixteen per cent of the Spanish economy is underground

This is just one of the findings of a study carried out by REAF-REGAF, part of the association of Spanish economists

DAVID VALERA

Friday, 16 June 2017, 12:52

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The underground or black economy in Spain is equivalent to 16 per cent of the countrys total economic production. This translates into 168 billion euros that escapes the taxmans gaze every year and 25.6 billion euros in tax revenue that goes uncollected.

These are the findings of a study carried out by REAF-REGAF, part of the association of Spanish economists. The good news is that this estimate is less than other studies that have placed the amount of annual tax lost at around 40 billion euros, as this study takes into account that not all the black money would be taxable. Jesús Quintas, one of the authors of the study, said that the 25.6 billion euros was a more realistic figure. He also added that the percentage of fraud is similar to other countries like Germany or Denmark.

The report makes 20 recommendations to fight the black economy. These include educating the general public on their duty to pay the correct amount of taxes and using more automated electronic collection methods.

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