The policy brief focuses on the impact of the governemnt measures put forward to counter the economic crisis and their effect on the hidden economy. The hidden economy has been a central topic for discussion in the public space upon each amendment to the economic legislation and particularly before elections or the passing of the national budget. Nevertheless, aside from the Annual Hidden Economy Index released by the Center for the Study of Democracy and a few sporadic analyses by other non-governmental, academic and business organizations, there is a lack of an adequate government system of ex ante and ex post impact assessment of the proposed measures to fight hidden activities of the wider economy. The adjustments of GDP done by the National Statistical Institute aiming to include hidden economy in the system of national accounts are not made public and do not serve as a basis for decision-making. Thus, public debates on hidden economy become little more than displays of rhetorical skills or actually serve completely different agendas rather than the implementation of measures to curb its negative impact.
The current analysis aims to outline a framework for policy assessment in the area of hidden economy by providing:
1.) an overview of the main macroeconomic imbalances related to the presence of hidden economy;
2.) the Hidden Economy Index values for 2002-2009;
3.) a summary of the measures to tackle hidden economy proposed in the past three years and a commentary on the expected effectiveness of the latest package of measures proposed by the Bulgarian Government.
