The estimate from the study for Romania is 13.1% of GDP in 2023, only about one percentage point higher than the global average.

Thus, the EY Global Study indicates that in 2000, Romania's informal economy was estimated at 31.3% of GDP, in 2013 at 19.5%, and by 2019 it had fallen to 15.1%.

The good news is that its share of the total is decreasing year by year, as part of a trend spanning over two decades.

The causes are multiple: from the budgetary after-effects of the 2008-2009 financial crisis to the costs of the pandemic and the current geo-political uncertainty, explains Alex Milcev, Partner, Head of Tax and Legal Assistance Department, EY Romania.

The long-term downward trend is clear, and the rate of reduction is naturally faster compared to other developed countries (because it starts from a more precarious base), added Milcev.

The EY report includes several key recommendations for political decision-makers to reduce the informal economy, such as boosting taxpayer confidence, simplifying and incentivising legal registration and operation of firms and or using third-party data through cross-checks of information from finance, labour, and public/private sources.