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Behind door No. 2 is failure to declare income tax.
While neoclassical economic theory sheds insight into the way that audit rates and penalty rates interact when individuals decide to declare income for taxation, it predicts far lower levels of compliance than observed levels of compliance.
The pair, who are feted by Hollywood stars, were handed 20-month jail sentences in June, for failing to declare income of €1bn to Italy's tax authorities.
According to tax officials, nearly half of boats larger than 35 feet are registered to people who declare income of less than $26,000 a year, and 604 airplane owners declared annual income between $26,000 and $65,000.
That would include cracking down on tax havens, taxing measures to increase corporate transparency, and revising tax treaties that allow for companies to declare income in countries other than those in which the income was earned.
Until recently, the Swiss government had steadfastly insisted on Swiss sovereignty and refused to provide assistance to other governments in cases of tax evasion — that is, cases in which a taxpayer failed to declare income, either intentionally or unintentionally.
Similar(40)
In Argentina, taxpayers must formally declare not only their declared income, but also their total wealth.
Not bad for a builder with a declared income in 1989 of 1.9m lire.
Their lifestyles are totally out of sync with their declared income".
One of the most brazen tax dodges is not declaring income.
The two are said to have declared income of only $3,000 a month between them.
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