National strategy for reduction of poverty and social exclusion in the republic of macedonia


The transfer of the informal economy into the formal economy



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The transfer of the informal economy into the formal economy presupposes several phases in resolving this issue, as follows:

  • 1) Creation of indicators for monitoring the transfer of informal into formal work, in accordance with the European Union principles.

  • 2) Changes to the tax system, the social insurance system and other types of incentives and support that will incentivize the unregistered firms to register.

  • 3) The benefits for starting a business and the business support should be related to the registered activity. This increases the transfers from the gray to the legal and formal economy.

  • 4) Creation of conditions conducive to the application of relevant punishments for creators of illegal businesses, as well as an opportunity to defer punishment if the business is transferred from the informal to the formal sector. The strengthening of the supervision and sanctioning measures against those that work in the gray or black economy, i.e. strengthening the inspection supervision, strengthening the human capacities of the inspection service and the integrated inspection (cooperation and coordination of the labor inspectorate, the market inspectorate, tax inspection and other inspection services) will significantly contribute to the reduction of the informal economy.

  • 6) Provision of a transition period to persons receiving social assistance benefits, to legalize their informal businesses, without immediately revoking the benefit. The purpose of this measure is to provide an additional incentive to legalize businesses which will grow and become contributors to the budgets of the country and the municipalities.













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