Economic Theories that Explain the Emergence of Tax Evasion

Roxana-Aurelia Mart () and Bogdan-Dumitru Cosofret ()
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Roxana-Aurelia Mart: "Alexandru Ioan Cuza " University of Iași
Bogdan-Dumitru Cosofret: "Alexandru Ioan Cuza " University of Iași

Ovidius University Annals, Economic Sciences Series, 2021, vol. XXI, issue 1, 782-790

Abstract: Tax evasion refers to the illegal activities deliberately undertaken by a taxpayer in order to release himself from the tax burden. Tax avoidance, on the other hand, usually denotes a situation in which the taxpayer has arranged his business in a perfectly legal way, resulting in either a reduced taxable income or an income for which to pay tax. The taxpayer is not obliged to pay an amount higher than the legal tax due, in accordance with the tax law. It is also not excluded that a taxpayer enters into a bona fide transaction which, when carried out, has the effect of avoiding or reducing the obligation to pay tax, provided that there is no provision in the law which prevents the avoidance or tax reduction. The purpose of this paper is to identify in the literature specialty which are identified determining factors regarding the taxpayer's behavior towards taxation in terms of compliance or non-compliance.

Keywords: tax evasion; tax; taxpayer; tax avoidance (search for similar items in EconPapers)
JEL-codes: M41 (search for similar items in EconPapers)
Date: 2021
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