This paper examines the role of international tax evasion for the choice of an optimal foreign tax credit by a capital exporting region. Since a foreign tax credit raises the opportunity cost of concealing foreign source income, it can be employed to discourage evasion activity. The existence of...

This paper examines the implications of increasing returns-to-scale evasion technologies for the optimal structure of commodity taxes. We find that, in the presence of evasion, tax design should aim at inducing uniform marginal evasion responses across commodities. This objective may dominate...