SOME €5 BILLION is being lost annually by the state, driving legitimate firms out of business, because of a culture of ‘nixers’ and ‘cash-only’ payments as well as an abuse of the social welfare system, according to the group representing small and medium-sized businesses.
The Irish Small and Medium Enterprises Association (ISME) says that there is a growing black economy in Ireland because of the rise in activities such as smuggling and non-reporting of income from firms and individuals, RTÉ reports.
It has called on the government to introduce tough new measures to tackle this.
ISME says there is a culture of ‘nixers’ – defined as a job done where the bill d0es not include tax, normally VAT – as well as a shift towards ‘cash -only’ payment and an easily abused social welfare system which is leading to the loss of revenue and the impact on businesses.
It values the black economy at some €25 billion in total, accounting for around 16 per cent of all of Ireland’s total output and the Irish Examiner reports on the number of recommendations it is making.
These include a review of taxation and the social welfare system; an overhaul of the Department of Social Protection and greater inspection and policing of welfare claims; tax-incentives for home owners who use verified trades people; and increased sharing of information among state agencies responsible for investigating the black economy.
Last month, the Minister for Social Protection Joan Burton said that her department would focus on policing the hidden economy in Ireland where social welfare fraud and abuse were prevalent.
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