, the tax base. A higher taxable income, in turn, can make tax evasion more attractive. We show for various specifications … of preferences that the tax base effect generally dominates. Consequently, relative consumption effects tend to reduce … tax evasion. This is true, irrespective of whether tax parameters are exogenous, guarantee a balanced budget or are set …

A tax buyout is a contract between tax authorities and a tax payer which reduces the marginal income tax rate in … tax evasion and show that a buyout can increase expected tax revenues. This will be the case if (1) the audit probability … taxes evaded, and authorities use information about income generated by the decision about a tax buyout offer when setting …

This paper deals with optimal income taxation under labor outsourcing and FDI. We show how the optimal income tax …