Risk Management at the Informal Economy Cutback (the Example of the Republic of Uzbekistan)

Abstract

The paper analyzes ways of the informal economy cutback in the Republic of Uzbekistan, used in the tax sphere. The purpose of the study is to summarize the tax measures to solve this problem. During past few years, there have been taken certain steps in this direction, such as concessions for small businesses in catering, reducing the turnover tax rate in the real estate business, holding large-circulation “check” lotteries with valuable prizes, bringing construction industry workers into the legal field, digitalization of tax administration. According to the authors, the proposed tools correspond both to the practices characteristic of foreign experience and to the conditions peculiarities for making business in Uzbekistan. Also, the authors identified some directions for improving the state tax policy in counteracting the spread of the informal economy: focusing on reducing cash turnover through the use of tax deductions for personal income tax and VAT refunds on purchases; the overall tax culture development; digitalization of the tax reporting procedure; improving a legal status the regulation of the self-employed citizens; initiation of a single tax account mechanism. The scientific novelty lies in the research methodology. Based on a comparative legal analysis, the experience of various countries is used to illustrate the features of tax measures applied in practice to reduce the informal economy. The authors assume the theoretical results of the work will embody in proposals for improving the national tax legislation and will improve the Russian economic and legal doctrine, as well as the level of legal research within the EAEU and the CIS.

Keywords

• taxation
• informal economy
• cis
• foreign experience
• republic of uzbekistan
• risks
• tax regulation
• tax policy
• tax administration