Gould, M. and Rablen, M.D. orcid.org/0000-0002-3521-096X (2019) Voluntary disclosure schemes for offshore tax evasion. Working Paper. Sheffield Economic Research Paper Series (2019006). Department of Economics , University of Sheffield. ISSN 1749-8368
Abstract
Tax authorities worldwide are implementing voluntary disclosure schemes to recover tax on offshore investments. The US and UK, in particular, have implemented such schemes in response to bulk acquisitions of information on offshore holdings, recent examples of which are the Paradise and Panama papers. Schemes offer affected investors the opportunity to make a voluntary disclosure, with reduced fine rates for truthful disclosure. Might such incentives, once anticipated by investors, simply en-courage evasion in the first place? We characterize the investor/tax authority game with and without a scheme, allowing for the possibility that some offshore investment has legitimate economic motives. We show that a scheme increases net expected tax revenue, decreases illegal offshore investment, increases onshore investment, but could either increase or decrease legal offshore investment. The optimal disclosure scheme offers maximal incentives for truthful disclosure by imposing the minimum allowable rate of fine.
Metadata
Item Type: | Monograph |
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Authors/Creators: |
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Copyright, Publisher and Additional Information: | © 2019 The Author(s). For reuse permissions, please contact the Author(s). |
Keywords: | voluntary disclosure; offshore tax evasion; tax amnesty; third-party information |
Dates: |
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Institution: | The University of Sheffield |
Academic Units: | The University of Sheffield > Faculty of Social Sciences (Sheffield) > Department of Economics (Sheffield) > Sheffield Economics Research Papers Series The University of Sheffield > Faculty of Social Sciences (Sheffield) > Department of Economics (Sheffield) |
Depositing User: | Symplectic Sheffield |
Date Deposited: | 22 Mar 2019 16:08 |
Last Modified: | 22 Mar 2019 16:08 |
Published Version: | https://www.sheffield.ac.uk/economics/research/ser... |
Status: | Published |
Publisher: | Department of Economics |
Series Name: | Sheffield Economic Research Paper Series |
Open Archives Initiative ID (OAI ID): | oai:eprints.whiterose.ac.uk:144042 |