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Tax Evasion and Tax Progressivity

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  • Laszlo Goerke

    (University of Mainz)

Abstract

In a pure tax evasion framework in which the monetary penalty is a function of the evaded tax, more progressive income taxes will reduce tax evasion if income has to be declared. However, if tax payments have to be declared, higher tax progressivity will have no effects. Thus, the relationship between tax evasion and tax progressivity depends on whether income or taxes have to be divulged to tax authorities. If the fine is a function of undeclared income, higher tax progressivity will always raise evasion.

Suggested Citation

  • Laszlo Goerke, 2003. "Tax Evasion and Tax Progressivity," Public Finance Review, , vol. 31(2), pages 189-203, March.
    • Handle: RePEc:sae:pubfin:v:31:y:2003:i:2:p:189-203
    DOI: 10.1177/1091142102250330
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    References listed on IDEAS

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    Cited by:

    1. Goerke, Laszlo, 2013. "Relative consumption and tax evasion," Journal of Economic Behavior & Organization, Elsevier, vol. 87(C), pages 52-65.
    2. Laszlo Goerke, 2015. "Income tax buyouts and income tax evasion," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 22(1), pages 120-143, February.
    3. Inna Cabelkova & Lubos Smutka, 2021. "The Effects of Solidarity, Income, and Reliance on the State on Personal Income Tax Preferences. The Case of the Czech Republic," Sustainability, MDPI, vol. 13(18), pages 1-22, September.
    4. repec:ebl:ecbull:v:8:y:2004:i:5:p:1-9 is not listed on IDEAS
    5. María Jesús Freire‐Serén & Judith Panadés, 2008. "Does Tax Evasion Modify the Redistributive Effect of Tax Progressivity?," The Economic Record, The Economic Society of Australia, vol. 84(267), pages 486-495, December.
    6. Gabriela S. Pantoja & Rodrigo S. Penaloza, 2014. "Tax evasion under behavioral structures," Economia, ANPEC - Associação Nacional dos Centros de Pós-Graduação em Economia [Brazilian Association of Graduate Programs in Economics], vol. 15(1), pages 30-40.
    7. Laszlo Goerke, 2014. "Tax Evasion by Individuals," IAAEU Discussion Papers 201409, Institute of Labour Law and Industrial Relations in the European Union (IAAEU).
    8. Rainald Borck, 2004. "Income Tax Evasion and the Penalty Structure," Economics Bulletin, AccessEcon, vol. 8(5), pages 1-9.

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