Corporate Tax Evasion: the Case for Specialists

Lipatov, Vilen (2005): Corporate Tax Evasion: the Case for Specialists.

Abstract

We analyze the role of accounting specialists who help corporations evade/avoid taxes in a game of incomplete information played by a tax authority, corporate taxpayers, and an accounting specialist. In addition to a full equilibrium characterization, we establish that (i) marginal changes in enforcement are not effective when evasion/avoidance is pervasive; (ii) fi�nes on fi�rms as opposed to specialists are more effective in such situations; (iii) reducing auditing costs and increasing "creative accounting" costs are effective in curbing evasion when tax compliance is relatively high.

• Item Type: MPRA Paper
• Institution: European University Institute, Hannover University
• Language: English
• Keywords: tax evasion; tax avoidance; tax compliance; sophisticated evasion
• Subjects: H - Public Economics > H3 - Fiscal Policies and Behavior of Economic Agents > H32 - Firm; H - Public Economics > H2 - Taxation, Subsidies, and Revenue > H26 - Tax Evasion and Avoidance

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