At least 3.3 million people have bypassed the tax office in the last twelve months, according to a study by the Institute of German Economy (IW) in Cologne, which is closely linked to employers. This represents 5.4 percent of people aged 15 to 74. In the years 2014-2024, the gray zone accounted for approximately ten percent of gross domestic product.
To combat illegal work, politicians must reduce the tax burden and contributions, the Cologne institute postulates. – New rules, regulations and controls will not limit illegal work, said the author of the study and IW behavioral economist Dominik Enste. – The state must address the causes. Working illegally is so attractive because employees have too low a net income, says the expert.
More men, less women
In particular, high-earners work illegally because cheating is especially profitable for them and the opportunity to do so arises more often. While 7.5 percent of men in Germany worked illegally in the last twelve months, women did so less often – only 3.5 percent. Experts also found significant differences by age: eleven percent of younger people (18 to 34 years old) were working illegally, compared to just three to five percent in other age groups.
According to IW, the shadow economy is even larger in many other industrialized countries. In Greece (21.4%), Italy (20.4%), Spain and Portugal (around 17%), the share of the gray economy in relation to gross domestic product is much higher than in Germany.
On the other hand, in the USA (5.8%), Switzerland (6.2%) and Japan (8.7%), illegal work is less common.
(RTR/jar)
The article comes from the website Deutsche Welle