IDEAS home Printed from https://ideas.repec.org/a/bla/scandj/v125y2023i3p753-788.html
   My bibliography  Save this article

Marketed tax avoidance: an economic analysis

Author

Listed:
  • Jiao Li
  • Duccio Gamannossi degl'Innocenti
  • Matthew D. Rablen

Abstract

Recent years have witnessed the growth of mass‐marketed tax avoidance schemes aimed at the middle (not top) of the income distribution, with significant implications for tax revenue. We examine the consequences for the structure of income tax, and for tax authority anti‐avoidance efforts, of tax avoidance of this type. In a model that allows for both demand‐ and supply‐side considerations, we find that: there is an endogenous threshold income below which taxpayers do not avoid, and above which they avoid maximally; the per‐dollar price of tax avoidance is decreasing in income under progressive taxation; endogenous adjustments in the price of avoidance make supply less responsive to anti‐avoidance activity than thought previously; and avoidance may drive a non‐monotone relationship between tax rates and tax revenue. These findings suggest that new approaches to anti‐avoidance, beyond legal enforcement, might be needed.

Suggested Citation

  • Jiao Li & Duccio Gamannossi degl'Innocenti & Matthew D. Rablen, 2023. "Marketed tax avoidance: an economic analysis," Scandinavian Journal of Economics, Wiley Blackwell, vol. 125(3), pages 753-788, July.
    • Handle: RePEc:bla:scandj:v:125:y:2023:i:3:p:753-788
    DOI: 10.1111/sjoe.12529
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/sjoe.12529
    Download Restriction: no
    File URL: https://libkey.io/10.1111/sjoe.12529?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:scandj:v:125:y:2023:i:3:p:753-788. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://onlinelibrary.wiley.com/journal/10.1111/(ISSN)1467-9442 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.