BOFIT Discussion Papers, Institute for Economies in Transition, Bank of Finland
Black cash tax evasion in Russia: Its forms, incentives and consequences at firm level
Abstract: This paper discusses Russia’s "black cash" economy. Using
interviews and survey data, we examine the mechanics of several distinctly
Russian tax evasion schemes and attempt a rough estimate of the scale and
dynamics involved in tax evasion based on black cash. Entrepreneurs’
opinions are also used to get an idea of the incentives and costs of black
cash tax evasion. We next describe the apparent economic consequences of
black cash tax evasion and formulate general formal conditions for
successful evasion at firm level. Finally, we recommend several policy
measures to reduce the incentives to such behaviour and discuss questions
for future research.
Keywords: tax evasion; informal business activity; black cash; Russia; (follow links to similar papers)
44 pages, September 14, 1999
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