Though declining in number, the shadow operations account for a solid portion of Russia’s small business.
Photo: Alexey Kudenko
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Small Business Unable to Step Out of Shade
Though declining, the share of under-the-table operations in small business is still very high, showed the survey of National Institute of Entrepreneurship Problems’ System Study.
The decline in shadowy business happens not because of some drop in laundering but due to the shadowy sales reduction. Not income defrauding but rather laundering has become a core component of obscure activities of an average firm in the past four years, the analysts concluded after studying 380 small firms in six cities of Russia.
The shadowy turnover narrowed from 45 percent to 41 percent of overall from 2002 to 2006. The decline could be attributed to reduction in shadowy sales – down from 21 percent to 16 percent of turnover. But the laundering amount has survived nearly in whole.
When it comes to the shadowy payments, the most common ones are wages, settlements with suppliers and bribes. Of interest is that the portion of firms paying shadowy salaries is going down (from 76 percent in 2002 to 69 percent in 2006), portion of firms bribing suppliers and lessees is relatively constant, but the share of firms bribing bureaucrats has widened.
www.kommersant.com
All the Article in Russian as of Apr. 25, 2007
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