The Underground Economy Index will be released in July by the Brazilian Institute of Competition Ethics (ETCO), together with the Brazilian Institute of Economics of the Getúlio Vargas Foundation (IBRE / FGV).

The latest survey, released in December 2011, showed a 1,1% drop in the year compared to 2009. After two years (2008 and 2009) growing, with a speed close to that of GDP, the underground economy accentuated the rate of fall, which reached, for the first time, around 17,2%. 

The analysis of absolute values ​​also showed a decrease. With the update, the estimate of the 2011 Underground Economy Index was R $ 653,4 billion. For the researcher responsible for the study, Fernando de Holanda Barbosa Filho, access to credit continues to be the main motivator for the formalization of employment by employees. “For employers, in addition to access to credit, another factor of influence is the consistency of the country's economic growth,” he says.

Informality, in addition to its relationship with organized crime and precarious working relationships, brings direct damage to society, creates an environment of transgression, and encourages opportunistic economic behavior, with a drop in the quality of investment and a reduction in the potential for growth of the Brazilian economy. In addition, it causes a reduction in government resources for social programs and investments in infrastructure.

About the Shadow Economy Index

ETCO believes that knowing the size of the problem is critical to tackling it. Much is said, but little is known about informality, piracy and evasion, as, as illegal activities, they are difficult to measure. ETCO, together with IBRE / FGV, has been publishing, since 2007, the Underground Economy Index, a study that estimates the values ​​of activities deliberately not declared to public authorities in order to evade taxes, and those of those who are in the informal sector due to excessive taxation and bureaucracy.

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