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The Effect of the Introduction of Online Cash Registers on Reported Turnover in Hungary


  • Gábor Lovics

    () (Központi Statisztikai Hivatal (Hungarian Central Statistical Office))

  • Katalin Szõke

    () (Magyar Nemzeti Bank (Central Bank of Hungary))

  • Csaba G. Tóth

    () (KSH Népességtudományi Kutatóintézet (Hungarian Demographic Research Institute))

  • Bálint Ván

    () (Pénzügyminisztérium (Ministry of Finance))


In order to reduce the shadow economy, in 2013 and 2014 the Hungarian government introduced mandatory online cash registers (OCR) in some sectors. As a result, almost 200,000 OCRs have been installed by 100,000 enterprises. In this paper we use micro data to estimate the effect of OCR introduction on reported turnover in the most affected sectors: retail, and accommodation and food services (AFS). We assume that OCR installation does not change a company’s operating model, so the increase in reported turnover around the installation date reflects a reduction in the shadow economy. We identify a remarkable effect of OCR introduction on reported turnover in both sectors. For small enterprises, reported turnover increased by 23 percent and 35.1 percent in the retail and AFS sector, respectively. We also find significant but smaller effects for medium-sized enterprises in both sectors. For large companies, we only observe a significant impact in the AFS sector.

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  • Gábor Lovics & Katalin Szõke & Csaba G. Tóth & Bálint Ván, 2019. "The Effect of the Introduction of Online Cash Registers on Reported Turnover in Hungary," MNB Occasional Papers 2019/137, Magyar Nemzeti Bank (Central Bank of Hungary).
  • Handle: RePEc:mnb:opaper:2019/137

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    References listed on IDEAS

    1. Hal R. Varian, 2010. "Computer Mediated Transactions," American Economic Review, American Economic Association, vol. 100(2), pages 1-10, May.
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    More about this item


    Value Added Tax; Tax Evasion; Shadow Economy;
    All these keywords.

    JEL classification:

    • E26 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Informal Economy; Underground Economy
    • H25 - Public Economics - - Taxation, Subsidies, and Revenue - - - Business Taxes and Subsidies
    • H26 - Public Economics - - Taxation, Subsidies, and Revenue - - - Tax Evasion and Avoidance

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