Question

In: Accounting

Find websites that list estimates of total unreported taxable income in the United States as well...

Find websites that list estimates of total unreported taxable income in the United States as well as other countries. In which countries is the problem most severe?

Solutions

Expert Solution

Overview: According to the new report from the United nations World Institute for Development Economics Research, Approx. $500 billion is the amount of revenue the world is losing as a result of the Tax evasion

Unreported Taxable Income: Non-reporting of taxable income is an activity which is a part of tax evasion. This is the illegal evasion of taxes by individuals, corporations, and trusts. Tax evasion often entails taxpayers deliberately misrepresenting the true state of their affairs of the tax authorities to reduce their tax liabilities and includes dishonest tax reporting such as declaring less income, profit or gain than the amount actually earned, or overstating deductions.

                Tax evasion is an activity commonly associated with the informal economy, one measure of the extent of the tax evasion is the amount of the unreported income which is the difference between the amount of income that should be reported to the tax authorities and the actual amount reported.

In which country the problem is more severe?

Well, it depends how we look at it. Building on an earlier IMF study, the report offers two different perspectives mentioned here under,

  1. Overall loss estimates, and
  2. Loss as a percentage of GDP

Overall loss estimates: In terms of overall losses, you probably won’t be surprised to see some of the world’s biggest economies at the top , Given the size and strength of their economies they have racked up significant losses, The Us losses an estimated $188 Billion every, with china a distant second as $66.80 Billion.

Losses as a Percentage of GDP: In the perspective of loss as a percentage of GDP, The intensity of losses is substantially greater in low- and lower middle income countries and in sub-Saharan Africa, Latin America and the Caribbean and in South Asia compared to other region.

Here are some website for the reference ,

http://www.europarl.europa.eu,

https://prospect.org,

https://developmentfinance.un.org,


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