On the Relative Size of Direct and Indirect Taxation

Gerasimos T. Soldatos

MPRA Paper from University Library of Munich, Germany

Abstract: Modifying the standard analytical apparatuses for direct and indirect tax evasion to incorporate forward indirect tax shift in a monopolistically competitive environment, this paper maintains that indirect tax evasion would exceed for sure direct tax evasion only under consumer risk neutrality and a tax policy zeroing the tax shift. Also, in the presence of tax evasion, there cannot be optimal direct-indirect tax mix, because tax evasion is accompanied by uncertainty and hence, nonlinearities in the tax schedules that cannot be dealt with at least practically.

Keywords: Direct and indirect tax evasion; Forward indirect tax shift; Consumer risk neutrality (search for similar items in EconPapers)
JEL-codes: H22 H24 H25 H26 (search for similar items in EconPapers)
Date: 2014
New Economics Papers: this item is included in nep-iue and nep-pub
References: View references in EconPapers View complete reference list from CitEc
Citations:

Published in International Economic Letters 2.3(2014): pp. 45-48

Downloads: (external link)
https://mpra.ub.uni-muenchen.de/60857/1/MPRA_paper_60857.pdf original version (application/pdf)

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: https://EconPapers.repec.org/RePEc:pra:mprapa:60857

Access Statistics for this paper

More papers in MPRA Paper from University Library of Munich, Germany Ludwigstraße 33, D-80539 Munich, Germany. Contact information at EDIRC.
Bibliographic data for series maintained by Joachim Winter ().