RE-EMERGENCE OF BLACK ECONOMY

The Institute of Chartered Public Accountants (CPA) is warning the re-emergence of the black economy could threaten Ireland’s chances of recovery, The Sunday Post reports.

The organisation is calling for measures to prevent the rampant under-the-counter payments culture of the 1980s from making an unwelcome return.

A spokeswoman for the CPA says an increasing number of businesses are now ‘undeclaring’ their income for tax purposes and some were not even registering for tax at all.

“In times of recession, there is a reversion to cash-based transactions, which is extremely damaging economically,” she told the newspaper. “The danger is that, with the increase in personal taxes and income levies, the temptation will be too great – and sole traders, contractors and companies will revert to cash if they think they can get away with it.”

She also called on the Revenue to continue targeting cash businesses in the way it has been doing over the past year in particular and for severe penalties for failing to provide VAT invoices for services.