Taxation and the Shadow Economy
Cash transactions for goods and services in which no receipts are issued greatly increase the risk of tax evasion. Despite the availability of banking services and alternative payment, key sectors of the economy remain largely cash-based in almost all developing countries. This paper shows the apparent strong negative correlation between the use of electronic or formal payments and the size of the shadow economy and reviews the approaches used by tax policy makers and administrators to achieve better control of cash transactions. It argues that the many new and sometimes innovative approaches developed to support the formalization of cash transactions will have little impact on the shadow economy if applied in isolation. A successful strategy to tax cash economy businesses and transactions requires a holistic approach to compliance management in which traditional monitoring and enforcement tools, such as enabling tax administrations to access taxpayer data and match information from various public and private sources, play a key role.
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| Main Authors: | , |
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| Format: | Working Paper biblioteca |
| Language: | English |
| Published: |
World Bank, Washington, DC
2018-03
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| Subjects: | SHADOW ECONOMY, TAX ADMINISTRATION, TAXATION, FORMAL ECONOMY, INFORMALITY, TAX COMPLIANCE, TAX POLICY, TAX EVASION, INFORMAL SECTOR, |
| Online Access: | http://documents.worldbank.org/curated/en/497071522428886160/Taxation-and-the-shadow-economy-how-the-tax-system-can-stimulate-and-enforce-the-formalization-of-business-activities https://hdl.handle.net/10986/29603 |
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dig-okr-10986296032024-10-17T10:21:49Z Taxation and the Shadow Economy How the Tax System Can Stimulate and Enforce the Formalization of Business Activities Awasthi, Rajul Engelschalk, Michael SHADOW ECONOMY TAX ADMINISTRATION TAXATION FORMAL ECONOMY INFORMALITY TAX COMPLIANCE TAX POLICY TAX EVASION INFORMAL SECTOR Cash transactions for goods and services in which no receipts are issued greatly increase the risk of tax evasion. Despite the availability of banking services and alternative payment, key sectors of the economy remain largely cash-based in almost all developing countries. This paper shows the apparent strong negative correlation between the use of electronic or formal payments and the size of the shadow economy and reviews the approaches used by tax policy makers and administrators to achieve better control of cash transactions. It argues that the many new and sometimes innovative approaches developed to support the formalization of cash transactions will have little impact on the shadow economy if applied in isolation. A successful strategy to tax cash economy businesses and transactions requires a holistic approach to compliance management in which traditional monitoring and enforcement tools, such as enabling tax administrations to access taxpayer data and match information from various public and private sources, play a key role. 2018-04-03T14:20:53Z 2018-04-03T14:20:53Z 2018-03 Working Paper Document de travail Documento de trabajo http://documents.worldbank.org/curated/en/497071522428886160/Taxation-and-the-shadow-economy-how-the-tax-system-can-stimulate-and-enforce-the-formalization-of-business-activities https://hdl.handle.net/10986/29603 English Policy Research Working Paper;No. 8391 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo World Bank application/pdf text/plain World Bank, Washington, DC |
| institution |
Banco Mundial |
| collection |
DSpace |
| country |
Estados Unidos |
| countrycode |
US |
| component |
Bibliográfico |
| access |
En linea |
| databasecode |
dig-okr |
| tag |
biblioteca |
| region |
America del Norte |
| libraryname |
Biblioteca del Banco Mundial |
| language |
English |
| topic |
SHADOW ECONOMY TAX ADMINISTRATION TAXATION FORMAL ECONOMY INFORMALITY TAX COMPLIANCE TAX POLICY TAX EVASION INFORMAL SECTOR SHADOW ECONOMY TAX ADMINISTRATION TAXATION FORMAL ECONOMY INFORMALITY TAX COMPLIANCE TAX POLICY TAX EVASION INFORMAL SECTOR |
| spellingShingle |
SHADOW ECONOMY TAX ADMINISTRATION TAXATION FORMAL ECONOMY INFORMALITY TAX COMPLIANCE TAX POLICY TAX EVASION INFORMAL SECTOR SHADOW ECONOMY TAX ADMINISTRATION TAXATION FORMAL ECONOMY INFORMALITY TAX COMPLIANCE TAX POLICY TAX EVASION INFORMAL SECTOR Awasthi, Rajul Engelschalk, Michael Taxation and the Shadow Economy |
| description |
Cash transactions for goods and services
in which no receipts are issued greatly increase the risk of
tax evasion. Despite the availability of banking services
and alternative payment, key sectors of the economy remain
largely cash-based in almost all developing countries. This
paper shows the apparent strong negative correlation between
the use of electronic or formal payments and the size of the
shadow economy and reviews the approaches used by tax policy
makers and administrators to achieve better control of cash
transactions. It argues that the many new and sometimes
innovative approaches developed to support the formalization
of cash transactions will have little impact on the shadow
economy if applied in isolation. A successful strategy to
tax cash economy businesses and transactions requires a
holistic approach to compliance management in which
traditional monitoring and enforcement tools, such as
enabling tax administrations to access taxpayer data and
match information from various public and private sources,
play a key role. |
| format |
Working Paper |
| topic_facet |
SHADOW ECONOMY TAX ADMINISTRATION TAXATION FORMAL ECONOMY INFORMALITY TAX COMPLIANCE TAX POLICY TAX EVASION INFORMAL SECTOR |
| author |
Awasthi, Rajul Engelschalk, Michael |
| author_facet |
Awasthi, Rajul Engelschalk, Michael |
| author_sort |
Awasthi, Rajul |
| title |
Taxation and the Shadow Economy |
| title_short |
Taxation and the Shadow Economy |
| title_full |
Taxation and the Shadow Economy |
| title_fullStr |
Taxation and the Shadow Economy |
| title_full_unstemmed |
Taxation and the Shadow Economy |
| title_sort |
taxation and the shadow economy |
| publisher |
World Bank, Washington, DC |
| publishDate |
2018-03 |
| url |
http://documents.worldbank.org/curated/en/497071522428886160/Taxation-and-the-shadow-economy-how-the-tax-system-can-stimulate-and-enforce-the-formalization-of-business-activities https://hdl.handle.net/10986/29603 |
| work_keys_str_mv |
AT awasthirajul taxationandtheshadoweconomy AT engelschalkmichael taxationandtheshadoweconomy AT awasthirajul howthetaxsystemcanstimulateandenforcetheformalizationofbusinessactivities AT engelschalkmichael howthetaxsystemcanstimulateandenforcetheformalizationofbusinessactivities |
| _version_ |
1813417080241782784 |