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EUROSTAT Tabular Approach to exhaustiveness

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					   EUROSTAT Tabular
Approach to exhaustiveness
        In Montenegro
N1-type of non-exhaustiveness
• This covers producers engaged in legal
  activities but deliberately not registering as
  a legal entity to avoid taxes, social security
  obligations, health and safety regulations,
  etc.
• This type of non-exhaustiveness is
  identified with NACE H - Hotels and
  restaurants.
• According to LFS, about 36% of the total
  number of persons employed was engaged
  in unregistered economic activities.
• The number of guest accommodated is an
  undercount in private sector and the gross
  output of hotels and their value added are
  underestimated.
• On these bases the expert’s estimate was
  made.
• MONSTAT increased its original estimate
  of value added by hotels and restaurants in
  2002 by around 11 per cent.
 N3-type of non-exhaustiveness
• This covers producers not required to register as
  a legal entity because they have no market
  output or their market output is below the level at
  which they are expected to register.
• In Montenegro this type of non-exhaustiveness
  is identified with NACE A - Agriculture, hunting
  and forestry, NACE F - Construction, and NACE
  K - Real estate, renting and business activities.
• Agriculture, hunting and forestry
  A large number of households produce
  agricultural products for their own
  consumption.
  One part of their products they sell either
  from their home or in the open market.
  Sales are not registered and all the sales
  income goes to the seller’s private budget.
• Construction
  As a general rule, workers hired to build
  private houses are not registered.
• Real estate, renting and business activities
  Many owners renting dwellings or business
  premises are not registered and do not
  report their incomes from renting to the Tax
  Authorities
• MONSTAT adjusted upwards its original
  estimates of value added in 2002 by 18
  per cent for agriculture, hunting and
  forestry, 5 per cent for construction, and 5
  per cent for real estate, renting and
  business activities.
N5-type of non-exhaustiveness
• This covers producers that are registered
  but not surveyed.
• In Montenegro, N5 is the principal type
  which refers to unincorporated enterprises
  and entrepreneurs.
• This type of non-exhaustiveness is
  identified with NACE A - Agriculture,
  hunting and forestry.
• MONSTAT increased its initial estimates of
  value added in agriculture, hunting and
  forestry (NACE A) for 2002 by 3 per cent.
N6-type of non-exhaustiveness
• This covers producers that are surveyed
  but who deliberately misreport their
  intermediate consumption or their gross
  output or both in order to avoid taxes and
  social security contributions.
• In Montenegro this type of non-
  exhaustiveness is identified with
  Manufacturing (NACE D), Construction
  (NACE F),…
…Wholesale and retail trade, repair of
motor vehicles, motorcycles and personal
and households goods (NACE G), Hotels
and restaurants (NACE H), Transport,
storage and communication (NACE I),
Education (NACE M) and Health and
social work (NACE N).
• MONSTAT increased its initial estimates of
  value added for 2002 in NACE D by 2 %,
  in NACE F by 18 %, in NACE G by 31 %,
  in NACE H by 4 %, in NACE I by 8 %, in
  NACE M by 5 % and in NACE N by 8 %.
        Summary of results
• As a result of non-exhaustiveness
  adjustments, value added over all
  economic activities (including FISIM) was
  increased by 9.7 per cent in 2002.
• N6-type of non-exhaustiveness is
  predominated.
• The estimate of non-exhaustiveness in
  MONSTAT is a new task and needs
  further refinement.
• Improving the exhaustiveness of GDP
  estimates also requires the co-operation
  and involvement of those other ministries
  and departments whose data are used in
  GDP compilation. MONSTAT therefore
  intends to establish an intra-government
  group on the non-observed economy that
  will include experts from these ministries
  and departments.
         Plan for future work
• To make a revision of the estimates as
  soon as the time series will be available
  (at least five years).
• The non-exhaustiveness adjustments that
  are defined in line with the classification
  non-exhaustiveness types followed by
  Eurostat in its tabular approach to non-
  exhaustiveness are included in the GDP
  estimates.

				
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