The Tax Gap: A Methodological Review

Gemmell, Norman; Hasseldine, John

doi:10.1108/s1058-7497(2012)0000020011

Cited by 34 publications

(41 citation statements)

References 22 publications

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“…Potential explanations for this can be found in Gemmell and Hasseldine (2012) and Rubin (2011). Gemmell andHasseldine (2012) argue that it is usually easier to calculate the theoretical tax liability for indirect rather than for direct taxes because for indirect taxes, data collected independently from tax data is frequently available. Rubin (2011) points out that indirect tax liability depends less on individual circumstances.…”

Section: Value Added Taxmentioning

confidence: 99%

“…The prevalent methods of measuring the shadow economy are single or multiple macro indicator methods (see, e.g., Gemmell and Hasseldine, 2012;OECD, 2002, p. 192;Schneider and Williams, 2013, for further explanations of these methods). They are based on the assumption that the invisible phenomenon to be measured cannot be completely hidden as it leaves observable traces.…”

Section: Shadow Economy Measurement Methodsmentioning

confidence: 99%

“…But these estimates should be verified with other methods, as the newer estimates are almost entirely based on non-reclaimed withholding tax. A comparison with asset non-compliance estimates from other countries or deriving the importance of non-declared assets for total tax noncompliance based on international literature is rather difficult as, according to Gemmell and Hasseldine (2012), literature on the tax gap of property taxes is generally scarce. Reasons for this might be that property taxes are not a major tax source in most OECD countries, if assets are taxed at all, and in any case, immovable property is rather difficult to hide.…”

Section: Asset Taxmentioning

confidence: 99%

“…10 Changes over time may be caused by measurement errors and factors independent of changes in the hidden activity (see Gemmell and Hasseldine, 2012). 11 There is very little literature currently available which analyses this topic (Gemmell and Hasseldine, 2012). 12 The initial and not the published discrepancy between the NA estimates should be taken, since the aim of NA statisticians is to minimise this gap (Schneider and Buehn, 2013).…”

Section: Shadow Economy Estimates For Switzerlandmentioning

confidence: 99%

“…17 Taxpayer audit methods are generally seen as fairly reliable in the literature and are key to many tax gap estimates by tax authorities such as in Denmark (see SKAT -Danish Tax and Customs Administration (SKAT), 2013), the United Kingdom (UK) (see IMF, 2013) and the US (see Black et al, 2012;Brown and Johns, 2007). Further, various authors (see Fuest and Riedel, 2009;Gemmell and Hasseldine, 2012;Skatteverket, 2014) prefer tax audits to estimate tax gaps as they allow a detailed analysis of taxpayer noncompliance and therefore provide valuable information to the authorities. Moreover, overstatement of deductions can be identified and the appropriate tax rate for each non-compliant activity estimated.…”

Section: Taxpayer Auditsmentioning

confidence: 99%

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Measuring the Invisible: An Overview of and Outlook for Tax Non-Compliance Estimates and Measurement Methods for Switzerland

Schmutz

2016

Swiss J Economics Statistics

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SUMMARYThis paper gives an overview of tax non-compliance estimates and evaluates the suitability of various tax non-compliance measurement methods for Switzerland. The existing estimates for Switzerland focus strongly on non-declared assets and are based on a limited number of measurement methods. Nevertheless, the estimates range widely, between CHF 106 to over 500 billion for non-declared assets and 12.6 to 35.1 percent for income, for the time period 1970 to today. These estimates could be taken as a starting point for further tax non-compliance research. They should however be verified and supplemented by estimates resulting from other methods as a solid measurement of tax non-compliance requires a comprehensive approach including several methods. Further, the focus should shift from non-declared assets towards non-declared income. (2) 1 Some authors use the expressions irregular, informal, underground, hidden, black or grey economy interchangeably with the expression shadow economy. We will refer to this from now on as shadow economy. 2 We prefer the expression tax non-compliance instead of the terms tax evasion or tax fraud commonly seen in the literature, as not every violation of tax law is wilful and some tax might not have been properly paid by mistake or due to the complex tax system. We will refer to tax evasion and tax fraud from now on as tax non-compliance.

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Section: Value Added Taxmentioning

confidence: 99%

Section: Shadow Economy Measurement Methodsmentioning

confidence: 99%

Section: Asset Taxmentioning

confidence: 99%

Section: Shadow Economy Estimates For Switzerlandmentioning

confidence: 99%

Section: Taxpayer Auditsmentioning

confidence: 99%

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Measuring the Invisible: An Overview of and Outlook for Tax Non-Compliance Estimates and Measurement Methods for Switzerland

Schmutz

2016

Swiss J Economics Statistics

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SME tax avoidance in the presence of informal competition from shadow economy

Farooq,

Elbannan

2023

J Corp Accounting Finance

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Using the data for Indian SMEs, this paper examines in an emerging market setting whether firms with exposure to informal competition are more likely to avoid taxes. We use a sample of 9281 Indian firms that responded to the World Bank Enterprise Survey and find empirical evidence that supports this conjecture. We find that firms headquartered in states/provinces with better business environment and firms with more competitive position in the market are less likely to avoid taxes in response to informal competition. This paper also shows that firms that avoid taxes are more likely to invest in innovation and have more efficient operations than the firm that does not avoid taxes.

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Theoretical and Methodological Framework of Tax Audit Transformation in Context of Innovative Economic Development

Serikova

Sembiyeva

2023

Transformation of Tax Audit in Innovative Economic Development

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The Tax Gap: A Methodological Review

Cited by 34 publications

References 22 publications

Measuring the Invisible: An Overview of and Outlook for Tax Non-Compliance Estimates and Measurement Methods for Switzerland

Measuring the Invisible: An Overview of and Outlook for Tax Non-Compliance Estimates and Measurement Methods for Switzerland

SME tax avoidance in the presence of informal competition from shadow economy

Theoretical and Methodological Framework of Tax Audit Transformation in Context of Innovative Economic Development

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