Economica (Feb 2020)

ECONOMETRIC APPLICATIONS REGARDING THE IMPACT OF TAX EVASION THROUGH ILLEGAL SCHEMES IN ORDER TO REDUCE THE FISCAL PRESSURE*

  • Liliana ISAC PETRILA,
  • Mariana GROSU

Journal volume & issue
Vol. 2, no. 112
pp. 64 – 72

Abstract

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In this article an analysis of the issue of tax evasion is made, a phenomenon encountered both in Romania and in the Republic of Moldova, as well as a description of the phenomenon through the illegal methods of tax minimization. The activity of a hypothetical economic entity that avoids paying taxes with the help of “straw/bogus” companies and “ghost” companies was analysed from an econometric point of view. As a result, the authors deduce that when an illegal tax evasion scheme is used, the tax burden is reduced, but the legal net profit is also reduced. Given the possible consequences of using such illegal schemes, economic entities should not use them in practice. Tax evasion has negative consequences for both the economy and the state as a whole.

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