How Company Registration Contributes To The Economy Part Two
Can Illegal Companies That Operate Also Contribute?
Operating without registration "exonerates" these companies from paying taxes and other forms of contribution to the economy.
Their income can be totally diverted to other, totally unrelated purposes.
On the other hand, their illegal status makes it difficult for them to hire a fixed payroll because of the lack of protection and commitment to the employee; and therefore they are unable to achieve a real stimulus over the economy. Their products or services will hardly be able to make their way in the legal market.
Sooner or later, the directors or owners of these companies end up condemned to closure and of fines for assuming this type of fraudulent activity.
As stipulated by the U.S. Small Business Administration, operating as a business illegally, without the requirements of state or local governments, is cause for a fine.
In cases where any business activity has been conducted without a license, the fine will be even greater and may include closure.
Company’s registration allows you to maintain detailed control over the growth of economic activity.
Thanks to each license, the authorities have a kind of map capable of reflecting, by state and locality, companies and businesses that are part of the commercial and economic network; it also makes it possible to monitor each of their monthly and annual contributions in payment of taxes.