The effects of the implementation of VAT on underground economy

Abstract

Underground economy on health and economic impacts of major economic indexes including the official GDP, employment, consumption, production and these taxes are recognized and adopted. VAT of the critical nature of the tax, which controls the process of multi-stage production and distribution of goods and services. Furthermore, the possible benefits of the tax credit in the tax transparency of the economy and particularly the discussion would be helpful to prevent tax evasion. Expansion of the informal economy to increase tax evasion and thus reduce tax revenues from the implementation of this type leads. Since the change in the economy and changes in the mode of production and distribution of wealth and income requires review revision of the types of taxes and their collection practices, the implementation of VAT in more than 140 countries acceptability by the government is.