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Tax Evasion in a Unionised Economy

Author

Listed:
  • Goerke, Laszlo

    (IAAEU, University of Trier)

Abstract
In a unionised labour market, a substitution of a payroll for an income tax will not alter employment if tax obligations are fulfilled. However, if workers or firms can evade taxes this irrelevance result might no longer apply. This will especially be the case if the fine for tax evasion depends on undeclared income or on wage payments or if withholding regulations prevent optimal evasion choices. In such instances, tax evasion opportunities make the legal incidence of taxes an important determinant of their economic incidence and employment can rise with a substitution of an income for a payroll tax.

Suggested Citation

  • Goerke, Laszlo, 2001. "Tax Evasion in a Unionised Economy," IZA Discussion Papers 382, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp382
    as

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    File URL: https://docs.iza.org/dp382.pdf
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    References listed on IDEAS

    as
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    13. repec:bla:scotjp:v:48:y:2001:i:4:p:461-70 is not listed on IDEAS
    14. Yaniv, Gideon, 1995. "A Note on the Tax-Evading Firm," National Tax Journal, National Tax Association, vol. 48(1), pages 113-20, March.
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    Full references (including those not matched with items on IDEAS)

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    Cited by:

    1. Marek Gora & Artur Radziwill & Agnieszka Sowa & Mateusz Walewski, 2006. "Tax Wedge and Skills: Case of Poland in International Perspective," CASE Network Reports 0064, CASE-Center for Social and Economic Research.
    2. Tomas Kögel, 2005. "On Substituting Consumption Taxes for Unemployment Insurance Contributions to Reduce Unemployment," Discussion Paper Series 2005_11, Department of Economics, Loughborough University, revised Sep 2005.

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    More about this item

    Keywords

    Economic incidence; legal incidence; penalty; tax evasion; trade union;
    All these keywords.

    JEL classification:

    • H22 - Public Economics - - Taxation, Subsidies, and Revenue - - - Incidence
    • H26 - Public Economics - - Taxation, Subsidies, and Revenue - - - Tax Evasion and Avoidance
    • J51 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Trade Unions: Objectives, Structure, and Effects
    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search

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