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Tax Evasion (tax + evasion)
Selected AbstractsCUT-THROAT FRINGE COMPETITION IN AN EMERGING COUNTRY MARKET: TAX EVASION OR THE ABSENCE OF MARKET POWER?,THE JOURNAL OF INDUSTRIAL ECONOMICS, Issue 4 2009ALBERTO SALVO Brazil's established soft-drink firms recently lost ground to multiple low-price entrants, with small-scale operations and minimal advertising. While incumbents attributed such undercutting to entrants' lower costs from non-compliance with the law, ,generics' counterargued that incumbents' high prices stemmed from unilateral market power rather than cost heterogeneity. By estimating a structural model, I can single-handedly explain established brands' high prices through low equilibrium price elasticities of demand. Tax evasion in the fringe, while plausible, appears to be offset by higher procurement costs or less efficient scale. More generally, a competitive informal sector can alleviate the allocative distortions in certain concentrated industries. [source] Tax Evasion and Voting: An Experimental AnalysisKYKLOS INTERNATIONAL REVIEW OF SOCIAL SCIENCES, Issue 2 2002Lars P. Feld The authors would like to thank Gerald Hosp and Hannelore Weck-Hannemann for valuable comments and suggestions. The usual disclaimer applies. [source] Effort and Aspirations in Tax Evasion: Experimental EvidenceAPPLIED PSYCHOLOGY, Issue 3 2009Erich Kirchler Is the effort exerted to earn taxable income considered in compliance decisions? And if so, is hard-earned income or easy money more likely to be concealed from authorities? While economic theory postulates that prior costs should not affect present decisions, psychological research shows that prior investments of money, time, or effort do matter. Findings from previous studies on the impact of effort on abstract decision tasks suggest two contradictory predictions for the context of tax compliance decisions: Either taxable income earned by high effort is subjectively of higher value, and therefore more likely to be evaded, or investments of effort cause a shift of the reference point through the establishment of an aspiration level, resulting in honest declaration of income. Two experiments were conducted to test these predictions. In a business simulation, taxable income was obtained by different levels of effort and consequently had to be reported to authorities. Results show that tax evasion was more pronounced in low-effort conditions. This suggests that effort changes the reference point rather than the slope, and provides evidence that in tax compliance decisions aspiration levels serve as reference points. Implications for tax audits are discussed. L'effort déployé pour obtenir des revenus imposables est-il pris en compte dans les décisions qui en découlent? Et si c'est le cas, est-ce l'argent facile ou les revenus durement gagnés qui présentent une plus forte probabilité d'être soustraits au fisc? Alors que la théorie économique postule que le coût antérieur n'a pas de retombées sur les décisions présentes, les recherches de psychologie montrent que les investissements passés en argent, temps ou effort ont leur importance. Des travaux sur l'impact de l'effort sur des tâches de décision abstraite débouchent sur deux prédictions contradictoires en ce qui concerne les décisions relatives à l'impôt: ou le revenu imposable obtenu à la suite d'un effort substantiel est subjectivement fortement valorisé et a de fortes chances d'être camouflé, ou l'effort investi provoque un changement de référence à travers l'instauration d'un niveau d'aspiration, ce qui a pour conséquence une déclaration honnête des revenus. On a réalisé deux expériences pour mettre à l'épreuve ces prédictions. Dans une simulation commerciale, le revenu imposable a été obtenu suite à différents niveaux d'effort et devait être portéà la connaissance du fisc. Les résultats montrent que l'évasion fiscale était plus accentuée dans les conditions où l'effort était modeste. Il faut en conclure que l'effort entraîne une mutation du système de référence plutôt qu'une simple modification de niveau et que dans les décisions relatives à l'impôt les niveaux d'aspiration servent de point de référence. On réfléchit aux leçons à en tirer pour le contrôle fiscal. [source] CUT-THROAT FRINGE COMPETITION IN AN EMERGING COUNTRY MARKET: TAX EVASION OR THE ABSENCE OF MARKET POWER?,THE JOURNAL OF INDUSTRIAL ECONOMICS, Issue 4 2009ALBERTO SALVO Brazil's established soft-drink firms recently lost ground to multiple low-price entrants, with small-scale operations and minimal advertising. While incumbents attributed such undercutting to entrants' lower costs from non-compliance with the law, ,generics' counterargued that incumbents' high prices stemmed from unilateral market power rather than cost heterogeneity. By estimating a structural model, I can single-handedly explain established brands' high prices through low equilibrium price elasticities of demand. Tax evasion in the fringe, while plausible, appears to be offset by higher procurement costs or less efficient scale. More generally, a competitive informal sector can alleviate the allocative distortions in certain concentrated industries. [source] Tax performance: a comparative studyJOURNAL OF INTERNATIONAL DEVELOPMENT, Issue 6 2004Joweria M. Teera This paper seeks to analyse tax performance across countries, utilizing what Musgrave (1969) referred to as the stochastic approach, where tax performance is analysed by comparisons with the average performance. The regression approach to tax performance assessment is used and a tax effort index is constructed. Among the variables that are identified to be important determinants of tax shares is a measure of tax evasion. The tax effort indices obtained show that generally the upper middle-income and high-income OECD groups are making better use of their tax bases to increase revenue. There are also economies of scale with respect to population density. Copyright © 2004 John Wiley & Sons, Ltd. [source] Modernization of Tax Administrations and Optimal Fiscal PoliciesJOURNAL OF PUBLIC ECONOMIC THEORY, Issue 6 2009MARTIN BESFAMILLE Since Sandmo (1981), many articles have analyzed optimal fiscal policies in economies with tax evasion. All share a feature: they assume that the cost of enforcing the tax law is exogenous. However, governments often invest resources to reduce these enforcement costs. In a very simple model, we incorporate such investments in the analysis of an optimal fiscal policy. We characterize their optimal level and we show numerically how they interact with the other dimensions of the optimal fiscal policy. Finally, we highlight the differences between our results and those obtained in a model without investment in the tax administration. [source] Under-reporting of Income and Labor Market PerformanceJOURNAL OF PUBLIC ECONOMIC THEORY, Issue 2 2008ANN-SOFIE KOLM To examine the effects on labor market performance of government tax and enforcement policies, this paper develops an equilibrium model featuring tax evasion, matching frictions, and worker,firm wage bargains. In the wage bargains, workers and firms can agree on the amount of remuneration that should not be reported to the tax authorities. We find that increased taxation actually reduces unemployment, whereas more zealous enforcement has the opposite effect. [source] Business Power and Tax Reform: Taxing Income and Profits in Chile and ArgentinaLATIN AMERICAN POLITICS AND SOCIETY, Issue 2 2010Tasha Fairfield ABSTRACT This article examines efforts to increase taxation of highly concentrated, undertapped income and profits in Latin America in the aftermath of structural adjustment. Argentina has advanced further than Chile in two policy areas: corporate taxation, which taps firm-level profits; and tax agency access to bank information, which helps reduce income tax evasion. These outcomes are explained by drawing on the classic concepts of business instrumental power, which entails political actions, and structural power, which arises from investment decisions. In Chile, strong instrumental power removed reforms in both areas from the policy agenda. In Argentina, much weaker instrumental power at the cross-sectoral level facilitated corporate tax increases. Bank information access was expanded after Argentina's 2001 crisis weakened the financial sector's instrumental power and reduced structural power. [source] Tax Amnesties, Justice Perceptions, and Filing Behavior: A Simulation StudyLAW & POLICY, Issue 2 2010SILVIA RECHBERGER A simulation study demonstrates the influence of perceived justice of a tax amnesty on subsequent tax compliance. In addition, it investigates how the amnesty is perceived to serve the punishment objectives retribution (i.e., giving offenders what they "deserve") and value restoration (i.e., restoring the values violated by tax evasion). Hierarchical regression analysis revealed the expected positive influence of justice on subsequent tax compliance. However, when the influence of punishment objectives was controlled for the influence of justice disappeared, while retribution and value restoration showed positive effects on post-amnesty tax compliance. [source] "Training in Citizenship": Tax Compliance and ModernityLAW & SOCIAL INQUIRY, Issue 3 2007Assaf Likhovski Do the attempts of modern states to foster tax compliance reflect wider attributes of modernity? This article analyzes the history of the creation of a tax compliance culture in Israel of the 1950s and the various practices, techniques, and discourses that were deployed by the state to create model taxpaying citizens. It shows how the specific history of tax compliance can be understood as part of a wider phenomenon: the desire of modern states to create self-policing, normalized subjects. By interpreting the history of tax compliance critically, as part of the attempt of the state to control its citizens, the article suggests a new way of understanding the history of twentieth-century tax compliance generally and more specifically the history of judicial attempts to tackle tax evasion and tax avoidance. [source] Estimating Tax Evasion Losses: The Road Fund CasePUBLIC BUDGETING AND FINANCE, Issue 1 2001Merl Hackbart Federal, state, and local government concern about the loss of state revenues from tax evasion has increased in recent years. In order for policymakers to address this issue effectively, more information regarding the nature and magnitude of the problem is needed. This article reports on research that focuses on estimating the level of road fund tax evasion for several states. Estimates of road fund tax evasion are developed from previous research regarding individual state evasion levels, perceptions of road fund tax evasion by state revenue officials, and a statistical estimate of road fund tax evasion. [source] Effort and Aspirations in Tax Evasion: Experimental EvidenceAPPLIED PSYCHOLOGY, Issue 3 2009Erich Kirchler Is the effort exerted to earn taxable income considered in compliance decisions? And if so, is hard-earned income or easy money more likely to be concealed from authorities? While economic theory postulates that prior costs should not affect present decisions, psychological research shows that prior investments of money, time, or effort do matter. Findings from previous studies on the impact of effort on abstract decision tasks suggest two contradictory predictions for the context of tax compliance decisions: Either taxable income earned by high effort is subjectively of higher value, and therefore more likely to be evaded, or investments of effort cause a shift of the reference point through the establishment of an aspiration level, resulting in honest declaration of income. Two experiments were conducted to test these predictions. In a business simulation, taxable income was obtained by different levels of effort and consequently had to be reported to authorities. Results show that tax evasion was more pronounced in low-effort conditions. This suggests that effort changes the reference point rather than the slope, and provides evidence that in tax compliance decisions aspiration levels serve as reference points. Implications for tax audits are discussed. L'effort déployé pour obtenir des revenus imposables est-il pris en compte dans les décisions qui en découlent? Et si c'est le cas, est-ce l'argent facile ou les revenus durement gagnés qui présentent une plus forte probabilité d'être soustraits au fisc? Alors que la théorie économique postule que le coût antérieur n'a pas de retombées sur les décisions présentes, les recherches de psychologie montrent que les investissements passés en argent, temps ou effort ont leur importance. Des travaux sur l'impact de l'effort sur des tâches de décision abstraite débouchent sur deux prédictions contradictoires en ce qui concerne les décisions relatives à l'impôt: ou le revenu imposable obtenu à la suite d'un effort substantiel est subjectivement fortement valorisé et a de fortes chances d'être camouflé, ou l'effort investi provoque un changement de référence à travers l'instauration d'un niveau d'aspiration, ce qui a pour conséquence une déclaration honnête des revenus. On a réalisé deux expériences pour mettre à l'épreuve ces prédictions. Dans une simulation commerciale, le revenu imposable a été obtenu suite à différents niveaux d'effort et devait être portéà la connaissance du fisc. Les résultats montrent que l'évasion fiscale était plus accentuée dans les conditions où l'effort était modeste. Il faut en conclure que l'effort entraîne une mutation du système de référence plutôt qu'une simple modification de niveau et que dans les décisions relatives à l'impôt les niveaux d'aspiration servent de point de référence. On réfléchit aux leçons à en tirer pour le contrôle fiscal. [source] | ||||||||||||||||