Tax Evasion and Economies in Transition: Lessons from Tax Theory

43 Pages Posted: 25 Sep 2007

See all articles by Jukka Pirttila

Jukka Pirttila

United Nations - World Institute for Development Economics Research (UNU/WIDER); Tampere University of Technology

Date Written: March 13, 1999

Abstract

This study considers the pervasive tax evasion of transition economies, with particular reference to Russia's tax system. Starting with a survey of theoretical literature on tax evasion and corruption, it argues that, although standard tax theory offers many insights, certain special features of transition economies deserve attention. These include the legacy of socialism resulting in a state willing to exercise discretionary power but possibly lacking credibility and public support, the 'disorganisation' phenomenon that hampers efficient tax administration, and the relationship of restructuring, speed of reform and the tax system. The paper also contains recommendations on reform of the tax system to achieve reasonable deterrence of evasion.

Keywords: tax evasion, corruption, transition economies, Russia

Suggested Citation

Pirttila, Jukka, Tax Evasion and Economies in Transition: Lessons from Tax Theory (March 13, 1999). BOFIT Discussion Paper No. 2/1999. Available at SSRN: https://ssrn.com/abstract=1016663 or http://dx.doi.org/10.2139/ssrn.1016663

Jukka Pirttila (Contact Author)

United Nations - World Institute for Development Economics Research (UNU/WIDER) ( email )

Katajanokanlaituri 6B
Helsinki, FIN-00160
Finland

Tampere University of Technology ( email )

P.O. 541, Korkeakoulunkatu 8 (Festia building)
Tampere, FI-33101
Finland

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