German Finance Minister Lars Klingbeil is planning reforms to intensify the crackdown on illegal work and tax evasion to increase state revenue, his ministry said on Tuesday.
The ministry stated that tax evasion and undeclared work would be fought with the utmost vigour.
A bill designed to strengthen checks is set to be introduced in the Cabinet on Wednesday, it said.
The legislation intends to enable the existing supervisory body to take more effective action against serious economic and organised crime.
Klingbeil is also looking to improve data exchange between relevant authorities.
The crackdown is set to focus in particular on employers who profit from illicit employment and violate minimum wage regulations, while exploiting workers and damaging the welfare state.
Auditors are to take a close look at subcontractors, particularly in the construction sector, while reducing the number of checks for firms playing by the rules, it said.
Meanwhile, investigators will be asked to scrutinise new sectors known to be hotspots for illicit employment, more specifically the hairdressing and beauty industry, including nail spas, according to government sources.
In the future, employees in those sectors will be required to carry an ID at work and present it upon request during checks.
A regulation had already been applied in the construction and catering sectors, for example.
Employers would be required to immediately report new hires to the pension insurance authority.
While hopes are that the changes would improve working conditions for employees in a range of sectors.
The legislation also intended to generate some 2 billion euros (2.3 billion dollars) in additional revenue for the federal government, federal states, and social security funds by 2029, according to the ministry.
(dpa/NAN)
