Taxation of Proceeds from Crime in Theory and Practice

Deniz Turan

Fiscaoeconomia, 2025, issue 1

Abstract: It forms part of an integrated strategy that includes taxing the proceeds of crime, confiscating criminal assets, and combating money laundering. Today, in many countries and Turkey, taxes have become central to the fight against proceeds of crime, representing a radical change in approach in the fight against proceeds of crime. The study aims to clarify the reasons and effectiveness of the intensive use of taxes in the fight against proceeds of crime. In this context, the study examined the regulations regarding the taxation of proceeds of crime in certain developed countries and Turkey, where economic crimes have been intense since the early 20th century. The findings of this study are as follows: Confiscation mechanisms may be insufficient in the fight against proceeds of crime. The activities of criminal organizations, which are inadequate in combating law enforcement methods and confiscation decisions, may be disrupted by the taxation of criminal income. Including all financial interests and income involved in crime within the scope of tax will reduce the informal economy, increase tax justice and, ultimately, tax morale, and allow the managers of criminal organizations to receive prison sentences for tax evasion. Confiscation of proceeds of crime should not be an obstacle to taxation. For an effective tax policy for the seizure of criminal proceeds, tax laws must be designed to tax not only legal and illegal income but also all material benefits and income obtained from crime, regardless of whether the source of criminal proceeds is identified or not.

Keywords: Proceeds of Crime; Money Laundering; Tax; Confiscation (search for similar items in EconPapers)
JEL-codes: H20 H26 K10 O17 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:fis:journl:250119

DOI: 10.25295/fsecon.1504349

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