Abrigo: Davao’s underground economy

UNDERGROUND economy refers to trading of goods or rendering services that is non-compliant to the government reporting requisites.

Let us not discuss in a broader sense involving the wholesale and retail of illegal drugs and undeclared import goods being the most common commodities in the dark market speaking of underground economy, because the government is now fighting to stop it.

I would rather open your mind on the other face of underground economy that is also called a “shadow market” or “black economy”. They are the ones gainfully earning but their businesses are conducted outside the sight of the law.

Often, the participants of this callous kind of business are compelled to engage in it because they don’t have enough capital. Not even enough to finance on the prerequisites set by the government to establish a legitimate business, like environmental requirements, licenses and permits until they are allowed to issue Official Receipts (OR).

As we eke out for living, many engaged into online selling and meet-ups, earning more than the legit boutiques. Street food vendors and sidewalk turo-turo also earn more than the eateries with business permits who can issue receipts; even home service massage, barbers, manicure-pedicure than those with air-con beauty shops. They are only few among the thousands of ambulant vendors earning favorable figures without taxes. I am just opening your eyes for a deeper understanding of what is underground economy. But deep in my heart I am NOT after of their taxes as I understand their daily grind.

The most glaring yet unnoticed devastating trade next to drug menace is the retail of beverages. Study shows that 85% of beers sold and consumed are from thousands of sari-sari stores nationwide and not from the bars. These sari-sari stores having small to minute capitalization have no permits from their respective barangays and therefore not issuing OR of the goods sold. The government has not recorded their earnings as the bases of collecting taxes.

Here is another form of underground economy in Davao city. It is so rampant that if you buy an electronic piece, RTW or any item along the business district of Uyanguren, many establishments are not issuing OR of the items you buy. Not even a paper rolled out from their POS but a generic sales invoice. Sometimes no piece of paper will justify the hundreds of pesos you spent, as if you buy a yema or tira-tira from a classmate.

The business bureau must look into these underground economies in Uyanguren. Most of these multi-million businessmen are not Pinoys and I am afraid that this city will lost a bigger chunk of revenue. This is detrimental to nation’s economic health.

abrigodann@gmail.com