Direct incentives and punishments are the most common instruments to fight tax evasion. The theoretical literature disregarded indirect schemes, such as itemised deductions, in which an agent has an interest in that other agents declare their revenue. Itemised deductions provide an incentive for...

Direct incentives and punishments are the most common instruments to fight tax evasion. The theoretical literature disregarded indirect schemes, such as itemised deductions, in which an agent has an interest in that other agents declare their revenue. Itemised deductions provide an incentive for...

With direct incentives and sanctions being the most common instruments to fight tax evasion, the theoretical literature has tended to overlook indirect schemes, such as itemized deductions, in which one agent has an interest in other agents declaring their revenue. Itemized deductions provide an...

Public finance is strongly affected by tax evasion, which implies that public sector resources are very limited. Most of the analysis on how to fight tax evasion focused on the ways to deter evasion through incentives to people not to evade. This model has a different approach: instead of...

Two global initiatives are examples of the effective use of tax systems instruments to protect countries' tax sovereignty in a world of increasing globalization. These OECD/G20 initiatives will provide tax administration and policy researchers with valuable insights on taxpayer and government...

There has been a lot of discussion recently regarding the macroeconomic consequences of a distortionary taxation system. However the way this distortionary taxation scheme or instrument is modeled in macroeconomic analysis, as well as the ability of these models to capture the effects implied by...

The paper provides a theory where the size of the inspection authority and the size of the fines evolve endogenously. We find that if a society cannot commit to future taxes it may gain form committing to a small Inland Revenue Service and small punishments for tax evasion. The possibility of...

There has been a lot of discussion recently regarding the macroeconomic consequences of a distortionary taxation system. However the way this distortionary taxation scheme or instrument is modeled in macroeconomic analysis, as well as the ability of these models to capture the effects implied by...

It is sometimes argued that a flat-rate tax reform can reduce tax noncompliance. The argument is, however, inconsistent with the so-called Yitzhaki’s puzzle of the classical expected utility (EU) model. The latter predicts an increase, rather than a reduction, in tax evasion following a cut in...