A recent report by the German Customs Office has revealed a significant increase in the financial damage caused by illegal work, with a total of 766 million euros in damages detected in 2024. This is a substantial rise from the 615 million euros reported in the previous year, according to the new Federal Minister of Finance and Vice-Chancellor, Lars Klingbeil, of the Social Democratic Party (SPD).
Experts believe that the actual extent of the problem may be even higher, given the lack of transparency in the sector. In a statement, Minister Klingbeil emphasized the need to intensify efforts to combat illegal work, protect individuals from exploitation and ensure state revenue. He announced the government’s plan to introduce a new bill to tackle the issue, which is expected to be presented before the summer break.
The proposed legislation aims to improve data analysis and exchange between social, financial and security authorities to identify and track illegal work more effectively. This will involve the use of automated data analysis, artificial intelligence and a full data exchange between the relevant authorities. The focus of the financial controllers will be on the beauty and hairdressing industry, as well as nail studios, among others.
Minister Klingbeil also pledged a “tougher approach” against criminals who profit at the expense of the public, emphasizing the need for the rule of law to prevail in the fight against financial crimes. He announced the intention to introduce new investigation tools, including a shift in the burden of proof for the seizure of assets, where individuals will be required to prove the legal origin of their wealth.
The minister’s statement underscored the importance of addressing the issue of illegal work, which not only causes financial losses but also undermines social justice and fairness. The government’s efforts aim to create a more transparent and just environment, where individuals can work without the threat of exploitation and where the state can collect the revenue it is due.