News2019.11.08 14:00

Despite government's war on black market, it still accounts for one fourth of Lithuanian GDP

BNS 2019.11.08 14:00

The Lithuanian state loses around a billion euros in uncollected VAT revenue every year due to the black market, despite active efforts to combat the problem, Deputy Auditor General Živilė Simonaitytė says.

“Based on the latest estimates, 1.1 billion euros in budget revenue was not collected in 2017 due to the VAT gap,” she said during a conference at the Seimas on Friday.

According to Simonaitytė, Lithuania uses 36 tools to combat the shadow economy, compared with 35 in Latvia, 20 in Poland, 13 in both Estonia and the Czech Republic, and eight in Sweden.

Surveys by Sprinter and the European Commission's estimates show that the black market in Lithuania accounted for around 24 percent of the GDP in 2018, about one-third above the EU average, according to Simonaitytė.

The shadow economy declined 1.5 percent last year compared with 2017, she added.

The Lithuanian government has claimed it expects to pull 200 million euros out of the shadow economy in 2020.

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