Abstract
This paper presents the results of the first of its kind survey on the undeclared work in Ukraine, performed by the students of the National University of Kyiv-Mohyla Academy. This is a pilot study based on 133 observations collected in March-April of 2020 in Ukraine. The sample mostly consists of young individuals residing in urban areas, single, without children, and more females as compared to males. To work undeclared means to have any paid activities that are lawful but not declared to the public authorities. The paper discusses who works undeclared in Ukraine, the educational attainment, the employment status and the economic activity of undeclared workers. Almost half of the respondents estimate the share of the population of Ukraine who perform undeclared work at the level of 43 per cent. Almost all admit knowing other undeclared workers. The risk of being detected for undeclared work is perceived to be low by almost half of the interviewees. The most popular undeclared activities are tutoring, sales, marketing, working as a waiter/waitress, an analyst, an employee in consultancy and construction. The income from formal work is observed to be lower than from undeclared work. The mean net income for formal work is under UAH 5,000 per month, while the mean net income for undeclared work is between UAH 5,000-10,000. The most common reasons for performing undeclared work are willingness to earn more, easiness to find a job, and avoiding paying taxes. Finally, the paper presents the list of recommendations to tackle the undeclared work in Ukraine, the most popular of which were as follow: to reduce the income tax, to increase fines for undeclared work, to introduce penalties for undeclared work not only for employers but also to employees, to strengthen administrative responsibility of employers, and to ease the tax system. JEL classification: E26, J46 Manuscript received 30.04.2020
Highlights
Introduction and research problemUndeclared work is of concern for countries, governments, and individuals because for rational economic agents in the long-run period its payoff is smaller than the gain
Undeclared work is defined as “any paid activities that are lawful as regards their nature but not declared to the public authorities, taking into account the differences in the regulatory systems of the countries” (Williams et al, 2017)
The paper presents the main findings of the sample of the undeclared workers in Ukraine interviewed during March-April of 2020
Summary
Introduction and research problemUndeclared work is of concern for countries, governments, and individuals because for rational economic agents in the long-run period its payoff is smaller than the gain. The paper presents the main findings of the sample of the undeclared workers in Ukraine interviewed during March-April of 2020. Respondents were asked to evaluate the share of the population of Ukraine that has work activity, which is not officially registered, or do not pay taxes.
Sign-in/Register to view highlights & summary 
Published Version (
Free)
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a call