Politics / Poland

Deregulation and Its Impact on the Shadow Economy

radio_zet • 2026-05-05T15:01:17Z

Source material: Deregulation and the Shadow Economy

Summary

Deregulation in Poland has led to faster procedures and digitization, yet significant barriers persist. Experts at the XVIII European Economic Congress highlighted that while some regulations have been relaxed, new obligations for businesses are increasing. The balance of regulatory changes is viewed as unfavorable, with many arguing that the additional burdens hinder business growth. The growth of the shadow economy is a direct consequence of excessive regulation, pushing compliant businesses towards illegal alternatives. Sectors such as alcohol and online gambling are particularly affected, as new regulations fail to curb demand while expanding illegal markets. Overregulation not only impacts businesses but also reduces tax revenues and public trust in government institutions. Recent government regulations on tobacco products exemplify how excessive regulation can limit product variety and drive consumers to illegal markets. This shift threatens consumer safety and diminishes state revenue.

Perspectives

Supporters of Deregulation

Claim that deregulation leads to faster procedures and digitization
Argue that reducing regulations can foster business growth

Critics of Deregulation

Highlight that new obligations increase burdens on businesses
Warn that excessive regulation drives growth in the shadow economy

Neutral / Shared

Acknowledge that some regulations have been relaxed
Note that the balance of regulatory changes is viewed as unfavorable

Key entities

Countries / Locations

Poland

Themes

#current_debate • #business_burdens • #business_growth • #deregulation • #shadow_economy

Key developments

Phase 1

The panel at the XVIII European Economic Congress highlighted that while deregulation has led to faster procedures and digitization, significant barriers remain. Experts argue that the balance of regulatory changes is unfavorable, increasing burdens on businesses and contributing to the growth of the shadow economy.

The European Economic Congress revealed that Polands regulatory changes often involve both deregulatory measures and new regulations that increase burdens on businesses
Experts contend that the current regulatory balance is detrimental, as increased burdens can hinder business growth and create market unpredictability
Excessive regulation is driving the growth of the gray economy, imposing a tax on legality that incentivizes compliant businesses to seek illegal alternatives
Sectors like alcohol and online gambling are particularly impacted, with new regulations failing to reduce demand while expanding illegal markets
Overregulation not only affects businesses but also leads to reduced tax revenues for the state and diminishes public trust in government institutions

Phase 2

Deregulation has led to faster procedures and digitization, but significant barriers remain unresolved. Experts warn that increasing obligations for entrepreneurs are contributing to the growth of the shadow economy.

Recent government regulations on tobacco products illustrate excessive regulation, which is likely to limit product variety and push consumers towards illegal markets
The shift to the black market not only diminishes state revenue but also endangers consumers who may acquire unsafe or untested products
The trend of overregulation across various sectors is fueling the growth of the gray economy, undermining legal businesses and reducing tax income for the state
As regulations increase, businesses encounter greater burdens, leading to decreased compliance and a rise in informal employment practices, further eroding tax revenues
These regulatory practices have broader implications, diminishing public trust in government and potentially jeopardizing consumer safety