Evaluation Of The Relationship Between Informal Employment, Income Tax And Economic Growth On Terms Of Turkey Economy

Authors : Mustafa Göktuğ KAYA

Pages : 108-117

View : 33 | Download : 7

Publication Date : 2019-03-27

Article Type : Research Paper

Abstract :The informal economy has become one of the most important problems in our country as a result of informal employment in working life. While economic, legal, social and cultural reasons are influential in the emergence of informal employment, the financial burden on employment are shown as one of the most important causes of informal employment in Turkey. However, the greatest loss of informal economic activities to the economy is tax loss. The tax burden on formal employees is increased to eliminate deficits in the government`s budget result of informal activities. This situation further increases the informality. For this reason, the state is trying to reduce informality with policies. In this study, the relationship between informal employment, the index of industrial production as a determinant of economic growth and tax revenues was investigated by using Multiple Regression Analysis with monthly data for 1996-2017 period. According to the analysis results, there is a positive relationship between the industrial production index and informal employment, but a negative relation with the income tax.
Keywords : Informal economy, Informal employment, Income tax, Industrial production index, CPI

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