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Estimation of the size of tax evasion in Greece

Author

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  • Anastasiou Athanasios
  • Kalamara Eleni
  • Kalligosfyris Charalampos

Abstract

The purpose of this paper is to estimate the extent of tax evasion in Greece for the period 1980-2018. For this estimation we have chosen to apply an indirect method of approach to the issue, as developed by Tanzi, based on the assumption that estimating the size of the shadow economy can lead us to a safe measurement of the extent of tax evasion. More precisely, through the Currency Demand approach which is based on the basic assumption that activities under the shadow economy constitute a direct response of taxpayers to the increased tax burden and also that cash is mainly used to conduct such transactions and of the wealth derived from them, the size of the shadow economy was determined using the method of the University of Leicester research team and then the level of tax evasion was assessed by imposing an annual tax rate on it as a ratio of total tax revenue to Gross Domestic Product. The results showed a significant increase of the size of tax evasion during the period considered, while the model estimation showed that most of the tax evasion came from direct taxation.

Suggested Citation

  • Anastasiou Athanasios & Kalamara Eleni & Kalligosfyris Charalampos, 2020. "Estimation of the size of tax evasion in Greece," Bulletin of Applied Economics, Risk Market Journals, vol. 7(2), pages 97-107.
    • Handle: RePEc:rmk:rmkbae:v:7:y:2020:i:2:p:97-107
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    References listed on IDEAS

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    Cited by:

    1. Anastasiou Athanasios & Kalligosfyris Charalampos & Kalamara Eleni, 2022. "Assessing the effectiveness of tax administration in macroeconomic stability: evidence from 26 European Countries," Economic Change and Restructuring, Springer, vol. 55(4), pages 2237-2261, November.
    2. Christos Papageorgiou & Panagiotis Farlekas & Zacharias Dermatis, 2021. "Assessing the impact of excise duties on a state’s revenues: the case of Greece," Public Sector Economics, Institute of Public Finance, vol. 45(3), pages 387-412.
    3. Athanasios ANASTASIOU & Vasiliki KREMASTIOTI, 2021. "The impact of taxation on growth: the case of Greece," Theoretical and Applied Economics, Asociatia Generala a Economistilor din Romania - AGER, vol. 0(2(627), S), pages 285-293, Summer.

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    More about this item

    Keywords

    Macroeconomics; public economics; applied economics; tax evasion; Greece;
    All these keywords.

    JEL classification:

    • H21 - Public Economics - - Taxation, Subsidies, and Revenue - - - Efficiency; Optimal Taxation
    • H26 - Public Economics - - Taxation, Subsidies, and Revenue - - - Tax Evasion and Avoidance
    • H30 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - General
    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies

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