The USAID Partnership for Better Business Regulation Project held a forum on the topic: “Mechanisms for elimination of gray economy, implementation and expected results” organized by the Macedonian Chambers of Commerce. At the high level, government representatives, domestic and foreign experts, professors and prominent businessmen discussed the biggest challenges of the companies in the fight against the gray economy, concrete solutions for its suppression as well as the expected effects on the economy and economy from the introduction of unregistered entities in the system. The President of the Association of Chambers of Commerce (SSK), Danela Arsovska in her address stressed that the gray economy undermines the competitiveness of companies and the integrity of our entire tax system.

“With an open discussion of this major problem, which is common to all sectors of the economy, we are asking for concrete steps by the institutions as bearers of the mechanisms for dealing with the gray economy. Proposed measures are implementation in practice of the Law on Prohibition and Prevention of Unregistered Activity, which would regulate the work in the gray zone, as well as joint action at the border crossings for the prevention of smuggling. To initiate a voluntary registration procedure in the first stage for unregistered entities if they refuse to register to apply repressive measures by imposing significant fines, because if this unfair competition is not prevented, it is risky for registered people to cross into the gray zone as well to discourage and not register entrepreneurs and all those who have encouraged themselves to self-work “, said Arsovska, adding that only with a functional mechanism can we deal with the gray economy, which does not contributes to the budget and undermines the fundamentals of equity on which the market system is based.

Zoran Sapuric, a minister in charge of regulation to improve the investment climate for domestic enterprises, noted that following recent research and experience, penal measures are not the only instrument for reducing the informal economy.

“In addition, commitments should also be aimed at systemic tax policy measures, deregulation, measures to increase tax morality, measures to reduce corruption and reform the tax administration. Hence, all efforts are directed towards sectoral or joint action in terms of regulatory and business environment, strengthening the institutions in the labor market, increasing the inspection of the flows of the informal economy and raising the wider public awareness with the business community about the significance and role of the process the formalization of informal activities, “said Sapuric.

Ljubomir Dimovski, USAID Project Manager, Partnership for Better Business Regulation, pointed out that the negative effects of the gray economy have been felt for several decades, but it is likely that all companies, institutions, government representatives would agree that together we need to find a solution and incentive like the informal action will be channeled into the formal economy.

“This process should be gradual and result in the transfer of as many entities as possible into the formal part of the economy. The preventive functioning of the inspection bodies as educators and helpers will contribute to changing the current perception that the gray zone is a safe working area. In addition to direct measures, one must also consider raising public awareness about the consequences of informal work. Non-selective enforcement of laws, education of entrepreneurs, regulation of “wild” places of sale are ideas that should already receive concrete outlines. It is necessary to systematically reduce the pressure on the companies that work regularly, because otherwise we risk incompatibility or closure of the entities due to the struggle with unfair competition and the huge difficulties to survive on the market, “said Dimovski.

The USAID Partnership for Better Business Regulation project is implemented by EPI CENTAR International in partnership with the Macedonian Chambers of Commerce, the Economic Chamber of Macedonia, the Economic Chamber of Information and Communication Technologies (MASIT), the Economic Chamber of North-West Macedonia.