The tax office has reason to believe that unregistered employees are not only numerous, but increasing.
The practice of working for cash at places of employment that require employees to be registered with the tax office and other government agencies is known in Iceland as “black work” (svört vinna). This term has no racial connotations but refers rather to the secretive nature of the practice.
RÚV reports that Skúli Eggert Þórðarson, the chief taxman, believes that black work is on the rise. His office has been taking a closer look at some 5,000 tax returns filed by companies in Iceland and found suspicious activity.
Most of these suspected incidences of black work are occuring in the fields of restaurant work, auto repair and construction. Black work in construction has actually been in decline, since a government sponsored programme called Everyone Works was launched with the purpose of encouraging construction companies to file their taxes properly.
Skúli says that a number of these suspected business have already been visited. He considers the matter very serious, as those businesses not paying the right amount of taxes are passing the burden onto others.
The Grapevine would add that black work is also not a good thing as employees engaged in it are more often than not foreigners who are being denied benefits they are legally entitled to receive.
Book your day tours in Iceland right here!