André Franco Montoro Filho, Advisory Adviser at ETCO, talks about underground economy, simplification of the tax system and culture of transgressions, some of the projects that he captained in the 4 years he was executive president of the Institute.

1. As a former president and current Advisory Adviser to ETCO and one of the creators of the Underground Economy Index, how do you see the downward movement of informality to 17,2% pointed out by the study?

Since 2003, according to IBRE / FGV estimates, the relative size of the underground economy in Brazil has been decreasing, that is, the formal economy grows more than the informal one. This is a good result. However, in absolute terms, the shadow economy continues to grow, which is worrying. Thus, these results, on the one hand, show that the work of ETCO and other institutions has been effective, but, on the other hand, indicate that there is much to do.

2. The simplification and rationalization of the tax system has always been one of the most important ETCO flags, since its foundation. In your opinion, what are the main obstacles to the progress of this process and what are the most efficient means for its implementation?

There is a saying that says "if you find a tortoise in a tree it is either flood or it is the hand of people, because tortoise does not climb a tree". The complexity of the tax system is in the hands of people. People who continue to occupy important positions in the government and in companies and who have managed to maintain unnecessary demands, as these give them power.

3. Institutional modernization, the strength of the economy and the decline in informality are positive aspects that, however, still live with the culture of transgressions, which brings in its wake one of the main evils of Brazilian society: corruption. Within this scenario, what is your view on current Brazil and where should it go in 2012?

Corruption is a radical form of transgression. The widespread perception of increased corruption and impunity for the corrupt is alarming because of its perverse effects on economic and social behavior. It is not possible to build a nation out of transgression.