The Tax Administration's Gray Economy Investigation Unit investigated the effects of the legislation on the obligation to disclose construction contract and employee information.
According to the results of the survey, legislative changes in the construction industry implemented since 2011, such as the reversed VAT liability, the tax number register, and contract and employee reporting, increased the wages of the construction industry by a total of approximately 300 million euros in 2015. Tax revenue increased by 100 million in the same year.
- The effects of the implemented reforms on the fight against the gray economy and the growth of tax revenues have been significant," says the head of the gray economy investigation unit Janne Marttinen.
- Based on the report, the key development needs were the re-evaluation of the information content of contract and employee data and the notification procedure, as well as the establishment of a site register. The goal should be to set correct and high-quality information and simplifying the procedure from the companies' point of view, says the chief inspector Eva Tiira From the gray economy investigation unit.
According to the report, there are still significant errors and deficiencies in construction announcements and notifications, even though advice and guidance have also been invested in.
Construction contract and employee data have increased tax collection by an estimated 31 million euros per year. The increase comes from both employer contributions and value added taxes.
More information about foreign labor at Finnish construction sites
The survey found that companies in the construction industry report their employees' salaries more comprehensively than before. The amount of foreign labor reported to the tax administration has increased with the expansion of the reporting obligation. The average and median wages of foreign workers have also increased. The observation gives indications that the salaries of foreign employees have been better covered by taxation than before, although shortcomings in the implementation of taxation were also observed.
Obligation to provide information on contract and employee information in construction - impact of legislation report, no. 7/2017
Check out the concise expert article about the report online at www.vero.fi/media. The investigation report and the event materials are also available at the same web address.
The bulletin was originally published by the Tax Administration (March 14.3.2017, XNUMX).