Underground Activity Accounts for 25 Percent of Israel's Economy

Gambling accounts for a big chunk, in the overtaxed and overregulated country

Israel's underground economy turns over NIS 140 billion a year, or about 25% of Israel's gross national product, Ronen Bar-El, a lecturer in economics at the Open University, told the Sderot Conference on Society.

The state loses an estimated NIS 59 billion a year due to tax evasion and illegal activities, said Bar-El, who based his estimates on figures from the Tax Authority.

If the figures are accurate, Israel's shadow economy would be among the biggest, in relative terms, among the 33 members of the Organization for Economic Cooperation and Development.

Only Greece, Italy, Spain, Portugal, Mexico and Turkey have undergorund economisbigger as a function of GNP.