The Role of Tax Control in Reducing the Size of the Shadow Economy

The shadow economy represents a significant challenge for national economic development and fiscal sustainability. It reduces government revenues, weakens public institutions, and distorts fair market competition. This study examines the role of tax control mechanisms in reducing the size of the shadow economy. The research analyzes the relationship between effective tax administration, tax monitoring systems, and the level of informal economic activities. Statistical and comparative analysis methods were used to evaluate international experiences in tax control practices. The results indicate that strengthening tax control systems significantly contributes to reducing shadow economic activities and increasing tax revenues. The findings highlight the importance of digital tax administration, risk-based tax audits, and improved tax compliance strategies in combating the shadow economy.