site.bta30-40% of Bulgarians Get Cash-in-Envelope Wages

In a research project on the determining factors of the shadow economy in the perceptions of Bulgarian society, Institute of Philosophy and Sociology found that between 30 and 40% of Bulgarians get cash-in-envelope wages.

"This is a very high percentage," said Assoc. Prof. Dr Lyuba Spassova of the Institute, presenting the results of the project at a conference on Friday. She specified that such people report part of their pay to the tax authorities but receive the remainder in cash, no questions asked.

There are numerous reasons for this, Spassova said, adding that, according to the prevalent opinion, the employer usually initiates this process for the purpose of tax evasion but the employee colludes and both parties benefit. Some people, however, told the researchers that they had bowed to employer's pressure.

This wrongdoing will take quite a long to uproot. First of all, it will require a change of culture and attitudes, and mistrust of the government and the institutions must be overcome, too, said Spassova. One of the most serious reasons why employees agree to be paid cash-in-envelope is the rife poverty and the risk of unemployment. "Part of the practices can easily be identified and detected, but when the Labour Inspectorate intervenes, cash payments cannot be proved because both payer and payee have conspired.    

Notably, over 90% of young people are inclined to get involved in shadow practices, she added, arguing for the need of educating people about their rights and obligations.