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When you’re in the market for a new automobile, the likelihood that you don’t have enough cash on hand is fairly high, to say the least. As such, some manner of financing is going to be involved. With the technology available today at one’s fingertips, the simplest way to go about getting financing is to go apply for online car financing. While there are a slew of other options, like banks and financing organizations, very few of them offer the versatility and speed that online car financing deals are known for.The first thing that you, or any buyer, should understand is that the companies you’ll be dealing with are still out to make a profit off of you. While the above statement holds true for even online car financing institutions, at the very least, you can be sure that the people lending you the money will bide their time but still take your money. Thus, dealing with an organization willing to make available the car loan you need is often the most cost-effective way to go about financing a car. Many believe the previous statement because of the fact that dealerships, while often tempting places to get financing deals, tend to tack on a variety of additional items such as extended service agreements.In place of the car dealership, you have the alternative of going on the Internet to try and find an online car financing deal which suits you. While it may take you a little bit longer than it would have if you’d gotten the deal off the dealership, going online will allow you to save more of your hard-earned money in the long run. Another advantage is that because you can shop around for good alternatives online, you can try and find a deal which looks like a better fit for your financial situation and doesn’t have interest rates and loan terms that you would be uncomfortable with.One other, major advantage of getting online car financing is that you will be getting the financing ahead of time, which opens up some interesting options. Chief among these options is the chance to just buy the car directly with cash. There are some online financing institutions that will allow you to do so, which means you have a better bargaining position to ask for a lower price. Primarily, this is because the dealership you will be buying from will get their payment in one lump sum, eliminating their chance to add additional costs through interest rates. It also saves you, the buyer, time since the option of purchasing in cash eliminates the need to negotiate interest rates, financing terms, and the like.A final, big advantage that an online car financing deal can afford you is the ability to choose the dealership you buy from. If the dealership you’ve gone to is not giving you a price that you are satisfied with, or is charging you too much for the car you want, you can just leave and go to another one without losing your car financing. You can leave that dealership and go for one that is more open to agreeing with your view on how much the car should be without worrying about the online car financing deal that you’ve arranged.

People increasingly rely on the internet for getting information and entertainment, and especially so if the area of their interest is technology. If you are looking for the best information about technology then you definitely need to get hold of the best possible technology news website out of the many options available to you. Visiting just a couple of sites at the maximum should be able to give you the information you need. Be sure to look for the following things when selecting a source of information on technology:1. Trends: Read about the latest trends in the area of technology and science and how they affect our lives so that you can stay ahead of them at all times. The field of tech is very fast moving and you’ll need to know about the latest trends in order to make the best use of technology.2. Reviews: There are lots of hardware and software options available at any point of time. The right reviews will help you choose the most suitable one to use. Be sure to select a site features authentic and detailed reviews that you can rely on in order to use the product or service in question.3. How-to Information: Even the most tech savvy person occasionally needs help with how to use certain things connected with tech. For instance, the latest smart phones and tablets have so many features that it is sometimes difficult for people to make full use of the device. Detailed how-to information is the simplest solution for this problem.4. Prices: This is very valuable information since you’ll obviously want to get a particular product or service at the lowest possible price. Knowing the accurate street price of any product will enable you to save a lot of money.5. Relevance: Be sure to select a tech site that offers you information on any area that is of interest to you. For instance, you might be interested in reading about internet security or social networking. The site should give adequate information on the topic. If you are interested in any tech developments in any particular geographical area, emerging markets for instance, then you should select an appropriate site.As you can see, there are many different things to be taken into account when selecting a technology site. Spending the time to select the right site will ensure that you get all the information you need without wasting any time.

The mobile revolution that has ushered in this decade is nothing short of a history being created. The fact that it has touched every facet of life makes it universally acceptable. Education is not left behind and several companies are trying to use mobile platform to provide a variety of education services. However, if anything to go by, the success is far-flung and no path breaking way has been found that would make mobile a true education device. This article tries to focus on the limitations that are hindering the success of mobile education.Screen Size
The largest mobile phone in terms of screen size is Dell Streak that has 5 inch display. However, still an average mobile phone screen is no more than 2.8 inches. Students are used to reading from pages that are larger in size. Hence, reading on 2.8 inches screen is never comfortable. The screen of mobile phone is mainly optimized for small text.Processing power limitations
Barring a few mobile phones, most of the cellular phones have slow processors. These processors are incapable of running animations or digital content effectively. Desktop computers and laptops do not face any such difficulty and therefore have become a preferred medium for online learning.Fragmented nature of Mobile OS platforms
Application developers find it extremely difficult to develop applications that can be run on all mobile operating systems. Imagine a class with 30 students and some having Nokia phones, others with Blackberries, and some using Androids. This is a real world issue that most of the education providers are grappling with.Expensive
Education is always considered as a service which is there for the masses. Hence, in many cases, education is affordable for a large number of students across the different economic strata. There is no doubt that devices such as iPhone can be used for mobile education. Unfortunately, not many can afford to buy an iPhone.Lack of government support
Present day governments have not yet understood that education in 21st century is no longer restricted inside the buildings of schools, colleges, and universities. New modes of imparting education have come up and mobile is one of them. Unless the governments around the world realize this and allocate resources, the mobile education will not succeed.Even though companies are talking about phones as low as $30, these devices will never be optimized for education. The solutions to the barriers, mentioned above, are hard to find. Even the much touted projects such as OLPC (One laptop per child) have not been able to bring a paradigm shift in the filed of education.  The time has come to change our approach and focus on the innovative products that are coming into the market. Yes! TABLETS! iPad, Galaxy Tab and many other touch screen tablets that can change the game altogether. The level of interactivity on touch devices is extremely high. Moreover, institutions can develop highly engaging and effective educational content. The fact that they can also run web content makes them all the more appealing.

Understanding money changes and how money is used to work for the individual is important and something that should not be considered lightly as it is something that can help one to foresee future economic problems and problems that are identified in the economy. Throughout history the power to control money and the power over banks has been fought over and in fact there have been entire wars that have been waged on these principals and beliefs alone. Further the economy is based on the overall ability of the government to be able to use the consumer’s money in order for there to be able to be some type of rate of duplication or overall problem manipulation. Economies of smaller countries could easily be manipulated when the value of a dollar changes. This means that when the government chooses to print new money and put new money into circulation that has not yet been backed in gold then the economies of smaller and less powerful companies are the ones that suffer the most.

These economies rely on the dollar and how that money plays into things and how much that money is worth. So when the money is worth less then their entire economy is worth less and thus it makes their economies less likely to be successful and more likely to crash or have other financial problems. So therefore economies from other parts of the world are falling in part because of the economic issues that have been seen in the United States. So therefore there are many things that should be considered with the overall interest of the economy when new money is being printed or when money is being changed in some way.

These other economies can not handle the things that are occurring with the changes in money as they are not as big or as strong as the American economy. Further the American economy has a big part of the world economy and often when economy issues occur with the American economy then the economies of other countries tend to follow. If stable economies are struggling and having problems then it is no wonder that smaller less sophisticated economies have bigger problems and are unable to handle things as they struggle through them.

Some of the questionable activities that are done by the Federal Reserve Bank are the creation of new money without the gold backing. This is considered questionable as there is nothing to back this new money so although more and new money is being put back into the economy there is still no reason for this and there are those who believe that this is one of the biggest economic mistakes that can be made. Even with other money changes there are several things that could be improved in order to stabilize the economy and what is going on in the economy and although these seem as though they are small changes for the American economy it is no wonder that there are serious problems for those smaller economies that rely on the value of the American dollar.

What is next for the economy? The economy defines the boundaries within which all businesses must operate.

Like the lines on the edges of the road, cross at your own risk. All businesses – and therefore all jobs in the private sector – must operate within (“length” and “width”) of these boundaries. Business failures occur when companies fall behind the times and are too far ahead of consumer demand. Likewise, most business sectors have a relatively narrow range of successful operations. It’s hard to survive if you are either the most expensive or cheapest in your market.

The 2010 book from David Wiedemer, PhD, Robert Wiedemer, and Cindy Spitzer entitled “Aftershock” examines the events that created the financial meltdown. In this book and the previous book, “America’s Bubble Economy” the authors make the case that the U.S. economy was an illusion, only the interaction of “bubbles”.

A bubble is created when an asset temporarily booms. The former (pre-2008) U.S. economy was comprised of bubbles in real estate, personal loans, credit card debt, the stock market, and consumer spending. On their own, each bubble can rise independently. But in combination, the bubbles accelerate and reach unnatural levels!

The financial meltdown felt around the world is the consequence of these bubbles popping, or as the authors describe it, a “Bubblequake”. The first stage of the financial meltdown included the fall of the real estate bubble, private debt bubble, stock market bubble, and discretionary spending bubble. On their own, each would have been significant. Combined, these popping bubbles lead to “The Great Recession”.

Amidst the economic turmoil, the U.S. government tried to intervene. Bailouts of automakers and investment banks were designed to compensate for “toxic assets”. Then the government pumped billions into the economy as “stimulus” to try to offset the funds lost to “money heaven” as bubbles popped and wealth simply evaporated.

Looking back, we now know that such efforts were ineffective. The results were a dramatically inflated money supply and a devalued dollar. The aftereffect was that the government soon reached the “National Debt Limit” as a result of spending nearly twice as much as incoming revenue.

The authors label this current stage as the “Aftershock”, defined as the popping of the dollar bubble and the government debt bubble. Their conclusion is that current economic conditions do not simply represent a down market cycle or a typical recession. The difference is the multi-bubble economy, with these inter-linked bubbles ALL on the descent.

The authors also conclude that inflating these bubbles again is simply not possible.

Instead, they predict what is called the “triple double-digit” economy:

Double-digit unemployment
Double-digit inflation
Double-digit interest rates
All in all, these make up some dire predictions. So what does this mean for you? How will you earn an income in the new, post-Aftershock economy.

The “Aftershock” authors predict:

1. Decreased demand for capital goods, including cars, construction equipment, and major industrial equipment. Lower demand means fewer viable firms and fewer available jobs.

2. Decreased levels of discretionary spending. This affects fine dining, entertainment, travel, fashion, jewelry, art and so on. Less total spending means fewer stores and fewer employees.

3. A decline (just not as drastic) in the “necessities” sector including health care, education, food, and government services. Even these areas will face some pressures to downsize because they are highly dependent on tax revenues. A smaller economy simply produces lower tax revenues. Some programs will simply need to shrink, regardless of the level of “necessity”. Many jobs will be retained, however the wage growth and benefits will necessarily be constrained.

Conclusion: as many as 50% of businesses in some sectors may simply disappear. This means that job losses will be staggering after the dollar and government debt bubbles pop, and there will be a mad scramble for those jobs that haven’t been destroyed. For most people it will be increasingly difficult to find a job – any job – regardless of your qualifications and experience. And for those lucky enough to be employed, keeping a job will mean putting up with less desirable working conditions, benefits, hours, and pay. In fact, as competition for jobs greatly increases, most wages will surely fall. After all the bubbles pop, people will accept wage cuts in most jobs for one simple reason: if they don’t, somebody else will.

By necessity, the government will be forced to live within tax revenue limits. The world economy will not allow unlimited printing of “funny money” to allow for unlimited deficit spending. The quantity of currencies injected by numerous countries will have already added to inflation on a global scale. Too many dollars, yen, euros, etc. will be chasing a declining quantity of goods and services.

The OLD economy is gone; the NEW economy is here.

In 2011 the federal government is overspending revenue by 40%. Even a 10% decrease in the size and scope of the federal government would add hundreds of thousands of additional people to the unemployment roles (including government positions and supporting private suppliers and contractors.) This does not consider the same cascading effects facing state and local governments that have never had the ability to simply print money.

So one of the defining characteristics of the post-dollar bubble economy will be a shortage of jobs. Unemployment levels will be much higher, and people will remain unemployed for much longer. At the same time, businesses will be forced to reduce wages and benefits to remain competitive. Millions of Americans will accept cuts in pay.

Especially hard hit will be younger workers and older workers. Prospective employees under 30 will find it hard to compete against older, more experienced and proven workers. Likewise, workers over 50 will also face extremely high unemployment levels.

At the same time, loss of tax revenue will force the government to tax more and tax deeper. Remaining businesses and employees will be taxed harder! Most will rationalize that 50% taxation is better than not working at all!

Different people will look at the same facts and draw different conclusions. So what do you think? Do you believe the bubbles will miraculously re-inflate and good times are on the horizon? Or do you believe (as the authors of “Aftershock” have detailed) that the old bubble economy is gone and a newer, leaner economy is what we can expect?

I concur with the conclusion that we are now experiencing the “aftershock”. I always knew that an economy based on 20% appreciation in housing values, pensions exceeding 100% of wages while working, whole shopping centers selling completely unnecessary novelties and decorations, and unbridled government deficit-spending had to “pop” eventually.

And yet I am also believe 100% in the viability of the free enterprise capitalist model. So I going to make some suggestions:

First, if you are under the age of 30 or over the age of 50 you are in danger of becoming a statistic. You either need to make yourself invaluable to your current employer or prepare yourself for the high possibility of a layoff.

Second, identify some necessary service or product that you can get excited about!

You have arrived at a “fork in the road”. You have two choices, plus a combination. You can take the wide road and do whatever it takes (training, cross-training, adult education, apprenticeships, etc.) to become superbly trained for the job you have or would like to have. Remember, there are going to be too many people seeking each job. You are going to need be impressive in every way and probably over-qualified to get noticed.

The second option (the “road less traveled”) is to design your own occupation. Now this can be a retail, service, or skilled occupation. Each has its attractions to certain people. My personal choice is to provide a product or service on a nationwide (or even global) basis. Again, these offerings should fall in the category of “necessities” rather than novelties. Luxuries offer a much smaller but profitable niche if you can cater to the affluent.

Even in tough times, fortunes can be made by satisfying needs. The time-proven formula for success is to identify a problem and provide a solution. In the post-bubble Aftershock economy, providing alternative income opportunities is one legitimate solution!

Now owning your own business includes the hassles of regulations and structure that you completely avoid if you stay in the employee category. But your own business also provides a degree of freedom not possible as an employee. The single biggest benefit is that you have no cap imposed on your income, especially if you are selling a product or service and not your efforts by the hour. Operating a business also allows you to deduct expenses before taxes. A higher potential income and tax advantages results in a win-win.

And then there is the combination of the two options, and this may be a viable option for the majority of Americans. If you have a steady job there is added security in building a part-time business on the side. You gain income and can offset a portion of your expenses that are now cutting into your after-tax personal income (such as a home office deduction, travel expenses for errands, office supplies, etc.) You also gain the security of a income cushion if your regular job evaporates or you face a cut in wages.

Of course, many small businesses eventually grow into large businesses. You then have the choice of making your part-time business a new full-time profession, hiring some employees to manage the extra work, or selling the business outright at a profit. Again, many advantages and few disadvantages (if designed with some forethought.)

The “road less traveled” provides increased potential rewards for assuming personal responsibility. At the same time, millions of Americans have learned that “job security” is a contradiction. We have entered the new age of job insecurity in an increasingly lean and competitive global economy.

So where do you start? Here are my recommendations for the ideal business:

1. Unlimited income potential. This is only possible if you are selling a product or service. If you are selling your time, you are limited by the number of hours you can work each day, week, and month. When you stop working you stop earning, and this is true even if you can bill your time at $200 per hour. Also, you want to have at least some products or services which generate repeat sales – unless what you are providing is incredibly profitable in the initial sale. Likewise, if your business allows you to leverage the efforts of others to provide additional streams of income, so much the better!

2. Time and location freedom. The ideal business will take advantage of current technologies and allow you to be located anywhere, and sell to anyone. These technologies will also allow your sales to recorded 24 hours per day, 7 days per week. Some products or services may have limitations which restrict the sales area to one location. But many products and services – especially digital products – allow sales to be made on a worldwide basis instantaneously!

3.Small initial investment. While many downsized employees have bought franchises and other fixed location business opportunities, I can not recommend this option. For one, the start-up costs can be very high, literally hundreds of thousands of dollars with no guarantees. Then you are faced with the reality that you have assumed the job of full-time personnel director and you spend all your time either managing employees or hiring their replacements. Instead, I would recommend an opportunity with a low start-up cost. This allows you to begin

part-time. It also means you won’t have to qualify for financing, which may be next to impossible for a new business in the post-bubble economy.

In my opinion, network marketing fulfills all these criteria. There are literally thousands of products and services that are marketing by networking. Combined with the power of the Internet and social media, networking has entered the mainstream and is a viable option for a full-time or part-time business.

Millions of Americans have used network marketing to produce extra income. The company provides all the support functions, from billing and credit card processing to accounting for commissions. Networking includes the creation of a downline that produces additional income. And consumable products provide residual income, often from several generations of customers that you have never even met.

There are no restrictions based on age, experience, location, or net worth to join a networking company. People from all walks of life – including unemployed – have become successful in network marketing. In fact, many thousands of networkers are literally unemployable after experiencing the freedom and income potential of network marketing.

Some call it the “unofficial” or “informal” economy, others call it the “grey economy” but the old name fits it best: the “black economy”. In the USA “black” means “profitable, healthy” and this is what the black economy is. Macedonia should count its blessings for having had a black economy so strong and thriving to see it through the transition. If Macedonia had to rely only on its official economy it would have gone bankrupt long ago.

The black economy is made up of two constituent activities:

Legal activities that are not reported to the tax authorities and the income from which goes untaxed and unreported. For instance: it is not illegal to clean someone’s house, to feed people or to drive them. It is, however, illegal to hide the income generated by these activities and not to pay tax on it. In most countries of the world, this is a criminal offence, punishable by years in prison.
Illegal activities which, needless to say, are also not reported to the state (and, therefore, not taxed).
These two types of activities together are thought to comprise between 15% (USA, Germany) to 60% (Russia) of the economic activity (as measured by the GDP), depending on the country. It would probably be an underestimate to say that 40% of the GDP in Macedonia is “black”. This equals 1.2 billion USD per annum. The money generated by these activities is largely held in foreign exchange outside the banking system or smuggled abroad (even through the local banking system). Experience in other countries shows that circa 15% of the money “floats” in the recipient country and is used to finance consumption. This should translate to 1 billion free floating dollars in the hands of the 2 million citizens of Macedonia. Billions are transferred to the outside world (mostly to finance additional transactions, some of it to be saved in foreign banks away from the long hand of the state). A trickle of money comes back and is “laundered” through the opening of small legal businesses.

These are excellent news for Macedonia. It means that when the macro-economic, geopolitical and (especially) the micro-economic climates will change – billions of USD will flow back to Macedonia. People will bring their money back to open businesses, to support family members and just to consume it. It all depends on the mood and on the atmosphere and on how much these people feel that they can rely on the political stability and rational management. Such enormous flows of capital happened before: in Argentina after the Generals and their corrupt regime were ousted by civilians, in Israel when the peace process started and in Mexico following the signature of NAFTA, to mention but three cases. These reserves can be lured back and transform the economy.

But the black economy has many more important functions.

The black economy is a cash economy. It is liquid and fast. It increases the velocity of money. It injects much needed foreign exchange to the economy and inadvertently increases the effective money supply and the resulting money aggregates. In this sense, it defies the dictates of “we know better” institutions such as the IMF. It fosters economic activity and employs people. It encourages labour mobility and international trade. Black economy, in short, is very positive. With the exception of illegal activities, it does everything that the official economy does – and, usually, more efficiently.

So, what is morally wrong with the black economy? The answer, in brief: it is exploitative. Other parts of the economy, which are not hidden (though would have liked to be), are penalized for their visibility. They pay taxes. Workers in a factory owned by the state or in the government service cannot avoid paying taxes. The money that the state collects from them is invested, for instance, in infrastructure (roads, phones, electricity) or used to pay for public services (education, defence, policing). The operators of the black economy enjoy these services without paying for them, without bearing the costs and worse: while others bear the costs. These encourages them, in theory to use these resources less efficiently.

And all this might be true in a highly efficient, almost ideal market economy. The emphasis is on the word “market”. Unfortunately, we all live in societies which are regulated by bureaucracies which are controlled (in theory, rarely in practice) by politicians. These elites have a tendency to misuse and to abuse resources and to allocate them in an inefficient manner. Even economic theory admits that any dollar left in the hands of the private sector is much more efficiently used than the same dollar in the hands of the most honest and well meaning and well planning civil servant. Governments all over the world distort economic decisions and misallocate scarce economic resources.

Thus, if the goals are to encourage employment and economic growth – the black economy should be welcomed. This is precisely what it does and, by definition, it does so more efficiently than the government. The less tax dollars a government has – the less damage it does. This is an opinion shares by most economists in the world today. Lower tax rates are an admission of this fact and a legalization of parts of the black economy.

The black economy is especially important in times of economic hardships. Countries in transition are a private case of emerging economies which are a private case of developing countries which used to be called (in less politically correct times) “Third World Countries”. They suffer from all manner of acute economic illnesses. They lost their export markets, they are technologically backward, their unemployment skyrockets, their plant and machinery are dilapidated, their infrastructure decrepit and dysfunctional, they are lethally illiquid, they become immoral societies (obligations not honoured, crime flourishes), their trade deficits and budget deficits balloon and they are conditioned to be dependent on handouts and dictates from various international financial institutions and donor countries.

Read this list again: isn’t the black economy a perfect solution until the dust settles?

It enhances exports (and competitiveness through imports), it encourages technology transfers, it employs people, it invests in legitimate businesses (or is practised by them), it adds to the wealth of the nation (black marketeers are big spenders, good consumers and build real estate), it injects liquidity to an otherwise dehydrated market. Mercifully, the black economy is out of the reach of zealous missionaries such as the IMF. It goes its own way, unnoticed, unreported, unbeknownst, untamed. It doesn’t pay attention to money supply targets (it is much bigger than the official money supply figure), or to macroeconomic stability goals. It plods on: doing business and helping the country to survive the double scourges of transition and Western piousness and patronizing. As long as it is there, Macedonia has a real safety net. The government is advised to turn a blind eye to it for it is a blessing in disguise.

There is one sure medicine: eliminate the population and both unemployment and inflation will be eliminated. Without the black economy, the population of Macedonia would not have survived. This lesson must be remembered as the government prepares to crack down on the only sector of the economy which is still alive and kicking.

Operational Recommendations

The implementation of these recommendations and reforms should be obliged to be GRADUAL. The informal economy is an important pressure valve for the release of social pressures, it ameliorates the social costs inherent to the period of transition and it constitutes an important part of the private sector.

As we said in the body of our report, these are the reasons for the existence of an informal economy and they should be obliged to all be tackled:

High taxation level (in Macedonia, high payroll taxes)
Onerous labour market regulations
Red tape and bureaucracy (which often leads to corruption)
Complexity and unpredictability of the tax system
Reporting Requirements and Transparency

All banks should be obliged to report foreign exchange transactions of more than 10,000 DM (whether in one transaction or cumulatively by the same legal entity). The daily report should be submitted to the Central Bank. In extreme cases, the transactions should be investigated.
All the ZPP account numbers of all the firms in Macedonia should be publicly available through the Internet and in printed form.
Firms should be obliged by law to make a list of all their bank accounts available to the ZPP, to the courts and to plaintiffs in lawsuits.
All citizens should be obliged to file annual, personal tax returns (universal tax returns, like in the USA). This way, discrepancies between personal tax returns and other information can lead to investigations and discoveries of tax evasion and criminal activities.
All citizens should be obliged to file bi-annual declarations of personal wealth and assets (including real estate, vehicles, movables, inventory of business owned or controlled by the individual, financial assets, income from all sources, shares in companies, etc.)
All retail outlets and places of business should be required to install – over a period of 3 years – cash registers with “fiscal brains”. These are cash registers with an embedded chip. The chips are built to save a trail (detailed list) of all the transactions in the place of business. Tax inspectors can pick the chip at random, download its contents to the tax computers and use it to issue tax assessments. The information thus gathered can also be crossed with and compared to information from other sources (see: “Databases and Information Gathering”). This can be done only after the full implementation of the recommendations in the section titled “Databases and Information Gathering”. I do not regard it as an effective measure. While it increases business costs – it is not likely to prevent cash or otherwise unreported transactions.
All taxis should be equipped with taximeters, which include a printer. This should be a licencing condition.
Industrial norms (for instance, the amount of sugar needed to manufacture a weight unit of chocolate, or juice) should be revamped. Norms should NOT be determined according to statements provided by the factory – but by a panel of experts. Each norm should be signed by three people, of which at least one is an expert engineer or another expert in the relevant field. Thought should be dedicated to the possibility of employing independent laboratories to determine norms and supervise them.
Payments in wholesale markets should be done through a ZPP counter or branch in the wholesale market itself. Release of the goods and exiting the physical location of the wholesale market should be allowed only against presentation of a ZPP payment slip.
Reduction of Cash Transactions

Cash transactions are the lifeblood of the informal economy. Their reduction and minimization is absolutely essential in the effort to contain it. One way of doing it is by issuing ZPP payment (debit) cards to businesses, firm and professionals. Use of the payment cards should be mandatory in certain business-to-business transactions.
All exchange offices should be obliged to issue receipt for every cash transaction above 100 DM and to report to the Central Bank all transactions above 1000 DM. Suspicious transactions (for instance, transactions which exceed the financial wherewithal of the client involved) should be duly investigated.
The government can reduce payroll taxes if the salary is not paid in cash (for instance, by a transfer to the bank account of the employee). The difference between payroll taxes collected on cash salaries and lower payroll taxes collected on noncash salaries – should be recovered by imposing a levy on all cash withdrawals from banks. The banks can withhold the tax and transfer it to the state monthly.
Currently, checks issued to account-holders by banks are virtually guaranteed by the issuing banks. This transforms checks into a kind of cash and checks are used as cash in the economy. To prevent this situation, it is recommended that all checks will be payable to the beneficiary only. The account-holder will be obliged to furnish the bank with a monthly list of checks he or she issued and their details (to whom, date, etc.). Checks should be valid for 5 working days only.
An obligation can be imposed to oblige businesses to effect payments only through their accounts (from account to account) or using their debit cards. Cash withdrawals should be subject to a withholding tax deducted by the bank. The same withholding tax should be applied to credits given against cash balances or to savings houses (stedilnicas). Alternatively, stedilnicas should also be obliged to deduct, collect and transfer the cash withdrawal withholding tax.
In the extreme and if all other measures fail after a reasonable period of time, all foreign trade related payments should be conducted through the Central Bank. But this is really a highly irregular, emergency measure, which I do not recommend at this stage.
The interest paid on cash balances and savings accounts in the banks should be increased (starting with bank reserves and deposits in the central bank).
The issuance of checkbook should be made easy and convenient. Every branch should issue checkbooks. All the banks and the post office should respect and accept each other’s checks.
A Real Time Gross Settlement System should be established to minimize float and facilitate interbank transfers.
Government Tenders

Firms competing for government tenders should be obliged to acquire a certificate from the tax authorities that they owe no back-taxes. Otherwise, they should be barred from bidding in government tenders and RFPs (Requests for Proposals).
Databases and Information Gathering

Estimating the informal economy should be a priority objective of the Bureau of Statistics, which should devote considerable resources to this effort. In doing so, the Bureau of Statistics should coordinate closely with a wide variety of relevant ministries and committees that oversee various sectors of the economy.
All registrars should be computerized: land, real estate, motor vehicles, share ownership, companies registration, tax filings, import and export related documentation (customs), VAT, permits and licences, records of flights abroad, ownership of mobile phones and so on. The tax authorities and the Public Revenue Office (PRO) should have unrestricted access to ALL the registers of all the registrars. Thus, they should be able to find tax evasion easily (ask for sources of wealth- how did you build this house and buy a new car if you are earning 500 DM monthly according to your tax return?)
The PRO should have complete access to the computers of the ZPP and to all its computerized and non-computerized records.
The computer system should constantly compare VAT records and records and statements related to other taxes in order to find discrepancies between them.
Gradually, submissions of financial statements, tax returns and wealth declarations should be computerized and done even on a monthly basis (for instance, VAT statements).
A system of informants and informant rewards should be established, including anonymous phone calls. Up to 10% of the intake or seizure value related to the information provided by the informant should go to the informant.
Law Enforcement

Tax inspectors and customs officials should receive police powers and much higher salaries (including a percentage of tax revenues). The salaries of all tax inspectors – regardless of their original place of employment – should be equalized (of course, taking into consideration tenure, education, rank, etc.).
Judges should be trained and educated in matters pertaining to the informal economy. Special courts for taxes, for instance, are a good idea (see recommendation below). Judges have to be trained in tax laws and the state tax authorities should provide BINDING opinions to entrepreneurs, businessmen and investors regarding the tax implications of their decisions and actions.
It is recommended to assign tax inspectors to the public prosecutors’ office to work as teams on complex or big cases.
To establish an independent Financial and Tax Police with representatives from all relevant ministries but under the exclusive jurisdiction of the PRO. The remit of this Police should include all matters financial (including foreign exchange transactions, property and real estate transactions, payroll issues, etc.)
Hiring and firing procedures in all the branches of the tax administration should be simplified. The number of administrative posts should be reduced and the number of tax inspectors and field agents increased.
Tax arrears and especially the interest accruing thereof should be the first priority of the ZPP, before all other payments.
All manufacturers and sellers of food products (including soft drinks, sweetmeats and candy, meat products, snacks) should purchase a licence from the state and be subjected to periodic and rigorous inspections.
All contracts between firms should be registered in the courts and stamped to become valid. Contracts thus evidenced should be accompanied by the registration documents (registrar extract) of the contracting parties. Many “firms” doing business in Macedonia are not even legally registered.
Reforms and Amnesty

A special inter-ministerial committee with MINISTER-MEMBERS and headed by the PM should be established. Its roles: to reduce bureaucracy, to suggest appropriate new legislation and to investigate corruption.
Bureaucracy should be pared down drastically. The more permits, licences, tolls, fees and documents needed – the more corruption. Less power to state officials means less corruption. The One Stop Shop concept should be implemented everywhere.
A general amnesty should be declared. Citizens declaring their illegal wealth should be pardoned BY LAW and either not taxed or taxed at a low rate once and forever on the hitherto undeclared wealth.
The Tax Code

To impose a VAT system. VAT is one the best instruments against the informal economy because it tracks the production process throughout a chain of value added suppliers and manufacturers.
The Tax code needs to be simplified. Emphasis should be placed on VAT, consumption taxes, customs and excise taxes, fees and duties. To restore progressivity, the government should directly compensate the poor for the excess relative burden.
After revising the tax code in a major way, the government should declare a moratorium on any further changes for at least four years.
The self-employed and people whose main employment is directorship in companies should be given the choice between paying a fixed % of the market value of their assets (including financial assets) or income tax.
All property rental contracts should be registered with the courts. Lack of registration in the courts and payment of a stamp tax should render the contract invalid. The courts should be allowed to evidence and stamp a contract only after it carries the stamp of the Public Revenue Office (PRO). The PRO should register the contract and issue an immediate tax assessment. Contracts, which are for less than 75% of the market prices, should be subject to tax assessment at market prices. Market prices should be determined as the moving average of the last 100 rental contracts from the same region registered by the PRO.
Filing of tax returns – including for the self-employed – should be only with the PRO and not with any other body (such as the ZPP).
Legal Issues

The burden of proof in tax court cases should shift from the tax authorities to the person or firm assessed.
Special tax courts should be established within the existing courts. They should be staffed by specifically trained judges. Their decisions should be appealed to the Supreme Court. They should render their decisions within 180 days. All other juridical and appeal instances should be cancelled – except for an appeal instance within the PRO. Thus, the process of tax collection should be greatly simplified. A tax assessment should be issued by the tax authorities, appealed internally (within the PRO), taken to a tax court session (by a plaintiff) and, finally, appealed to the Supreme Court (in very rare cases).
The law should allow for greater fines, prison terms and for the speedier and longer closure of delinquent businesses.
Seizure and sale procedures should be specified in all the tax laws and not merely by way of reference to the Income Tax Law. Enforcement provisions should be incorporated in all the tax laws.
To amend the Law on Tax Administration, the Law on Personal Income Tax and the Law on Profits Tax as per the recommendations of the IRS experts (1997-9).
Customs and Duties

Ideally, the customs service should be put under foreign contract managers. If this is politically too sensitive, the customs personnel should be entitled to receive a percentage of customs and duties revenues, on a departmental incentive basis. In any case, the customs should be subjected to outside inspection by expert inspectors who should be rewarded with a percentage of the corruption and lost revenues that they expose.
In the case of imports or payments abroad, invoices, which include a price of more than 5% above the list price of a product, should be rejected and assessment for the purposes of paying customs duties and other taxes should be issued at the list price.
In the case of exports or payments from abroad, invoices which include a discount of more than 25% on the list price of a product should be rejected and assessment for the purposes of paying customs duties and other taxes should be issued at the list price.
The numbers of tax inspectors should be substantially increased and their pay considerably enhanced. A departmental incentive system should be instituted involving a percentage of the intake (monetary fines levied, goods confiscated, etc.)
The computerized database system (see “Databases and Information Gathering”) should be used to compare imports of raw materials for the purposes of re-export and actual exports (using invoices and customs declarations). Where there are disparities and discrepancies, severe and immediate penal actions should be taken. Anti-dumping levies and measures, fines and criminal charges should be adopted against exporters colluding with importers in hiding imported goods or reducing their value.
Often final products are imported and declared to the customs as raw materials (to minimize customs duties paid). Later these raw materials are either sold outright in the domestic or international markets or bartered for finished products (for example: paints and lacquers against furniture or sugar against chocolate). This should be a major focus of the fight against the informal economy. I follow with an analysis of two products, which are often abused in this manner.
I study two examples (white sugar and cooking oil) though virtually all raw materials and foods are subject to the aforementioned abuse.
White Sugar is often imported as brown sugar. One way to prevent this is to place sugar on the list of LB (import licence required) list, to limit the effective period of each licence issued, to connect each transaction of imported brown sugar to a transaction of export, to apply the world price of sugar to customs duties, to demand payment of customs duties in the first customs terminal, to demand a forwarder’s as well as an importer’s guarantee and to require a certificate of origin. The same goes for Cooking Oil (which – when it is imported packaged – is often declared as some other goods).
All payments to the customs should be made only through the ZPP. Customs and tax inspectors should inspect these receipts periodically.
All goods should be kept in the customs terminal until full payment of the customs duties, as evidenced by a ZPP receipt, is effected.
Public Campaign

The government should embark on a massive Public Relations and Information campaign. The citizens should be made to understand what is a budget, how the taxes are collected, how they are used. They should begin to view tax evaders as criminals. “He who does not pay his taxes – is stealing from you and from your children”, “Why should YOU pay for HIM?” “If we all did not pay taxes- there would be no roads, bridges, schools, or hospitals” (using video to show disappearing roads, bridges, suffering patients and students without classes), “Our country is a partnership – and the tax-evader is stealing from the till (kasa)” and so on.
The phrase “Gray Economy” should be replaced by the more accurate phrases “Black Economy” or “Criminal Economy”.
Sam Vaknin is the author of “Malignant Self Love – Narcissism Revisited” and “After the Rain – How the West Lost the East”. He is a columnist in “Central Europe Review”, United Press International (UPI) and ebookweb.org and the editor of mental health and Central East Europe categories in The Open Directory, Suite101 and searcheurope.com. Until recently, he served as the Economic Advisor to the Government of Macedonia.