Underground Economy Averages 37% of GDP

The underground economy and tax evasion in Iran have been estimated to average 37.7% and 3.5% of gross domestic product respectively in the fiscal 2017-8, an analytical research published by the Iranian National Tax Administration shows.
Using Vito Tanzi’s Currency Demand Approach and Vector Error Correction Model, the research put the size of the underground economy at an estimated 5,584 trillion rials ($24 billion) and tax evasion at 515 trillion rials ($2.2 billion).
Iran’s total tax revenues stood at 1,366 trillion rials ($5.86 billion) and the country’s GDP, using current prices, amounted to 14,807 trillion rials ($63.5 billion) in the year under review.
The rial values have been converted using current dollar exchange rates.