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Serious tax fraud and noncompliance
Author(s) -
Levi Michael
Publication year - 2010
Publication title -
criminology and public policy
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.6
H-Index - 33
eISSN - 1745-9133
pISSN - 1538-6473
DOI - 10.1111/j.1745-9133.2010.00645.x
Subject(s) - sanctions , tax evasion , imprisonment , audit , publicity , construct (python library) , business , compliance (psychology) , retributive justice , political science , law and economics , criminology , public economics , law , accounting , economics , psychology , economic justice , social psychology , computer science , programming language
Research Summary This article reviews what international evidence exists on the impact of civil and criminal sanctions upon serious tax noncompliance by individuals. This construct lacks sharp definitional boundaries but includes large tax fraud and large‐scale evasion that are not dealt with as fraud. Although substantial research and theory have been developed on general tax evasion and compliance, their conclusions might not apply to large‐scale intentional fraudsters. No scientifically defensible studies directly compared civil and criminal sanctions for tax fraud, although one U.S. study reported that significantly enhanced criminal sanctions have more effects than enhanced audit levels. Prosecution is public, whereas administrative penalties are confidential, and this fact encourages those caught to pay heavy penalties to avoid publicity, a criminal record, and imprisonment. Policy Implications Although it has yet to be proven that prosecution has a greater or lesser impact on these offenders, increased prosecution might be justified for purposes of moral retribution as well as perceived social fairness.