LFMI

The shadow economy in Lithuania remains pervasive despite economic growth, and as many as one in two people would consider informal consumption and undeclared work if their financial circumstances worsened, shows a LFMI research report.

The aim of the publication Shadow Economy: Understanding Drivers, Reducing Incentives is to present and analyse the results of representative population surveys into public perceptions of the shadow economy and engagement in illicit activities that were conducted in six countries.

The competitiveness of a country’s tax system is instrumental in creating a favorable environment for foreign direct investment, stimulating business, and advancing societal well-being. Competition based on endogenous factors should not be perceived as unjust or unnatural.

Labor market flexibility may be characterized by the market participants\' abilities to deviate from standard labor regulations and typical forms of employment. Such possibilities may not only provide positive outcomes to both employers and employees, but they may also benefit the whole economy.

There is evidence showing that increases in mandatory minimum wage might force some firms to increase prices, lay off workers, cut fringe benefits for employees and engage in other revenue-boosting or cost-cutting measures.

Taxation of tobacco products raises severe economic and social concerns which should be taken into account when formulating further tobacco taxation policies, including on novel tobacco products. Increased education rather than higher excise duties should be the main policy.

The European Commission has presented a new proposal on the System of Own Resources of the European Union. If agreed on, the provisions of this proposal shall apply from January 1, 2021 - except the provisions regarding the CCCTB.

The definition of small and medium enterprises (SMEs) is an important issue, regarding not only a number of European policies that have been set up to ensure these SMEs benefit from financial support, fee reduction, reduced administrative burden, etc.

In late June the Lithuanian Parliament adopted a law that consolidated the employer and employee base for social security contributions and significantly cut the rate of contributions.

LFMI has just released its latest paper \"Labor Migration and Flexibility of Regulation for Employing Non-EU Nationals\". It addresses the economic effects of migration and implications of employing non-EU nationals and provides a cross-country legislative and policy analysis on the flexibility of hiring of non-EU nationals.