Economics at your fingertips  

Optimal tax policy under tax evasion

George Economides (), Apostolis Philippopoulos () and Anastasios Rizos ()
Additional contact information
Apostolis Philippopoulos: Athens University of Economics and Business
Anastasios Rizos: Athens University of Economics and Business

International Tax and Public Finance, 2020, vol. 27, issue 2, No 4, 339-362

Abstract: Abstract We study the properties of the optimal tax mix in the presence of tax evasion. The setup is a version of the neoclassical growth model in which households can choose to under-report their labour and capital income, firms can choose to under-report their sales, and a Ramsey government, taking all this into account, chooses the time-paths of tax rates on labour, capital and consumption to maximize households’ lifetime utility. We show that tax evasion, and its type, are crucial to the properties of optimal tax policy.

Keywords: Tax evasion; Optimal taxation; Efficiency (search for similar items in EconPapers)
JEL-codes: H21 H26 E62 (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link) Abstract (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link:

Ordering information: This journal article can be ordered from
http://www.springer. ... ce/journal/10797/PS2

DOI: 10.1007/s10797-019-09564-7

Access Statistics for this article

International Tax and Public Finance is currently edited by Ronald B. Davies and Kimberly Scharf

More articles in International Tax and Public Finance from Springer, International Institute of Public Finance Contact information at EDIRC.
Bibliographic data for series maintained by Sonal Shukla ().

Page updated 2020-06-18
Handle: RePEc:kap:itaxpf:v:27:y:2020:i:2:d:10.1007_s10797-019-09564-7