If you’re gonna click on the link dear readers……..turn up those speakers…….it’s Iron Maiden’s Fear Of The Dark!!
http://www.youtube.com/watch?v=28GaKoCuobU
Feel better for that?………I do, so much so, I’m gonna click the link again!
Ok……before we get into the post……..a trivia question for your dear readers. What does Iron Maiden’s lead singer Bruce (Air-Raid Siren) Dickinson and my wife have in common?
Now to Ukraine’s “shadowy economy”…….which is hardly a new subject on my blog…….although I have not been able to back up any figures and guesstimates officially as to how much of the economy is blacker than the soul of Aleister Crowley.
Mr Crowley
Eh?…….Aleister Crowley was a famous/infamous occultist. Google him, he was quite an interesting character. In fact, if you can find “Liber XXX Aerum – The Vision and the Voice” on the internet…….it is an interesting read.
Anyway, going back to the subject of the post, having wandered twice already, the Ukrainian Economy Minister, Bohdan Danylyshyn, yesterday stated that there was some concern amongst the Ukrainian Cabinet that the “shadow economy” in Ukraine has risen from 28% in 2008 to 32% in 2009.
He claims this figure has been arrived at using recognised systems globally…….but doesn’t identify which system was used specifically.
He officially blames Ukraine’s complicated and unworkable tax system.
In this, he has a valid point……50% of the black economy is down to an unworkable and uncollectable tax system. The other 50% is down to front line State employed people being paid so little that “cash incentives” for jumping the waiting list at hospital or for the Traffic Cop to look the other way when you have been speeding are the norm. Obviously these “cash incentives” are simply pocketed to make up something resembling a wage which makes life livable in Ukraine.
Eh?……..No I’m not joking. When Doctors, Nurses, Police and other State employees get around 500 UAH (ish) per month…….that’s about $63.00 (ish)……per month……..it is hardly surprising that “cash incentives” are almost mandatory here to get anything done.
In some cases you pay a little more to get things to happen…….in others you pay so that they don’t happen…….depending on the lowly paid State employee you are facing at the time.
Eh?………No dear readers, things are not relative to salary of the State official. $63.00 is a meal for 3 people in a decent restaurant…….and the decent restaurants are always full.
So let us look at the figures, 32% doesn’t mean much…….until you consider it means 1 of every 3 financial transactions I do is in the black economy. Even that doesn’t sound to bad……..so lets look at it nationally.
It means that 1 of every 3 financial transactions made by 46,000,000 people every second, of every minute, of every hour, of every day in Ukraine is within the black economy. That is trillions of black economy dealings every year in Ukraine…….and millions every day!!
Of course, if the Government is acknowledging 32% of the economy is beyond their measurements……..then any Government financial and economic statistics have a margin of error of up to and including 32%!!
Oh, dear readers, don’t go jumping to the conclusion that it is all massive scale organised crime…….it is not. Whilst undoubtedly organised crime does well out of the situation……and I won’t deny it, I live in Odessa, a place infamous throughout the FSU for it’s mafia…….and indeed I do know a few of the “businessmen” who operate at the top of the black economy here……..the vast majority of what would be classed as the black economy keeps the poorer people in Ukraine above the bread line.
To remove the black economy, without a social system in place…..which there is…….and without sufficient funds……which there isn’t…….would turn a lot of citizens to crime……other than simply tax evasion.
As the international crime statistics posted by myself a few days ago, shows Ukraine as a fairly crime free nation, even per capita, compared to many……and another post showed only 1.77% of the nation pays any form of tax…….let alone the correct amount of tax…….it is possible to see why the black economy must be suffered for the time being.
In the absence of a simple and workable tax system and social system financed sufficiently to stop people turning to crime should the black economy disappear overnight……..at present there seems little alternative to it.
Ukraine as a nation is piling up the international debts to stay afloat, so the chances of State employees getting the significant raise in pay required to stop the need for “cash incentives” to do their jobs is not at all likely…….in fact, there is more chance of the hole in my arse healing over.
These “cash incentives” are indeed themselves a form of unofficial taxation……as without paying them, the chances of getting anything done are about as successful as a John McCain presidential campaign or a Gordon Brown policy!
This leaves Ukraine with only one option to combat the expanding black economy and that is to change, overhaul, scrap and recreate an effective taxation system and policy………Are they going to do it?……….How are they going to do it?……….Read my post tomorrow and I will explain all.
Eh?…….Ah,……the Trivia question. The answer is, the lead singer from Iron Maiden was a leading swordsman in Britain and my wife was the USSR undefeated Epee champion from 1982 – 1992.
Now you can take your Trivia Green Cheese and roll the dice again!
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