Download tax evasion - IIS "Leonardo da Vinci"

THE CONSEQUENCES OR EFFECTS OF TAX EVASION
MACROECONOMIC EFFECTS
• Public Debt
• Fight Tax Evasion
• Cuts in Public Spending
MICROECONOMIC EFFECTS
• Tax Evasion
• Tax Avoidance
• Traslation
Public Debt
The policy maker gets the missing
resources from the financial
markets, increasing the issuance
of government securities.
Despite being a short-term
solution, this path causes a
growing indebtedness of the state
in the long term and the payment
of interest on securities by the
time they expire.
Fight Tax Evasion
The policy makers increases
the control and tax assessment
to identify tax evaders.
It is a complex operation since
tax assessment has a cost for
the State and does not
verify/discover all the situations
of abuse.
Cuts in Public Spending
The policy maker reduces public
expenditure in terms of lower supply of
public goods and services. It is the most
political difficult action. The inability to
raise public revenue involves public
spending cutting, a lower supply of
public goods and public services. In
some cases the cut in public spending is
a good thing because it allows you to
rationalize expenditure and eliminate
waste (failure state). In other cases, it
results in an additional economic burden
borne by the less affluent citizens who
have to face with an increasing tax
pressure.
Health
Education
Retirement
funds
Tax Evasion
We can speak of tax evasion
when the taxpayer subtracts
illegally to tax payment.
Tax evasion is punishable by law
with administrative or penal
measures according to the entity
of the crime.
Tax Avoidance
Is the arrangement of one’s
financial affairs to minimize
tax liability within the law.
Business uses of legal
methods to modify an
individual’s financial situation
in order to lower the amount
of income tax owed are put
into practice.
This is generally accomplished
by claiming the permissible
deductions and credits.
This work has been powered by Ferdinando Renzulli VA AFM – school year 2015/2016