Gamannossi degl'Innocenti, D. and Rablen, M.D. orcid.org/0000-0002-3521-096X (2017) Tax avoidance and optimal income tax enforcement. Journal of Tax Administration, 3 (2). pp. 36-64.
Abstract
We examine the optimal auditing problem of a tax authority when taxpayers can choose both to evade and avoid. For a convex penalty function, the incentive-compatibility constraints may bind for the richest taxpayer and at a positive level of both evasion and avoidance. The audit function is non-increasing in reported income, and is higher for progressive tax functions than for regressive tax functions. Higher marginal tax rates increase the incentives for non-compliance, overturning the well-known Yitzhaki paradox.
Metadata
Item Type: | Article |
---|---|
Authors/Creators: |
|
Copyright, Publisher and Additional Information: | © 2017 Journal of Tax Administration. |
Dates: |
|
Institution: | The University of Sheffield |
Academic Units: | The University of Sheffield > Faculty of Social Sciences (Sheffield) > Department of Economics (Sheffield) |
Depositing User: | Symplectic Sheffield |
Date Deposited: | 20 Dec 2017 09:27 |
Last Modified: | 20 Dec 2017 09:27 |
Published Version: | http://jota.website/article/view/143 |
Status: | Published |
Publisher: | University of Exeter Business School |
Refereed: | Yes |
Open Archives Initiative ID (OAI ID): | oai:eprints.whiterose.ac.uk:124930 |