Sector-Specific Characteristics of Tax Crime in Russia

Abstract

The article discusses the hypothesis that fiscal crime has some sector-specific characteristics, which tend to become more pronounced as new technologies emerge and develop. These characteristics should be taken into account when devising policies targeted at fighting tax evasion. To test this hypothesis, we analyzed quantitative (the level of economic crime in Russia in general and for different types of economic activity) and qualitative characteristics of crime (structure, dynamics and nature of crime). We also conducted analysis of the correlation between these indicators and the structure of costs and financial performance of organizations. The research relies on crime statistics, which reflect the scale of tax evasion better than financial statistics (since the latter are influenced by a large number of factors and are subject to significant change even within one year). Pearson’s and Spearman’s correlation coefficients were used for verification. Sectors of economy were ranked in descending order according to the corresponding economic crime rates and loss to gross value added in the sector. The findings show that unlike the cases of tax evasion, the number of economic crimes does not closely correlate with the structure of costs. Most tax crimes and corporate tax evasion in particular are recorded in sectors with lower labour costs, social security contributions and other prime costs but with higher depreciation of fixed assets (capital intensive industries). Thus, the results of this study contradict the findings of international scholars that shadow economy is larger in highest paying industries. It is shown that the sectors with higher losses are characterized by higher crime rates, that is, the loss in many cases is connected to tax evasion and related economic crime. The research has brought to light certain sector-specific characteristics of tax evasion, which means that these characteristics should be taken into account in governance and policy-making as well as in further research on this topic.

Gender and White-Collar Crime: Convenience in Target Selection

“…White-collar crime includes all kinds of financial offences, such as fraud, manipulation, and corruption (Dearden 2016(Dearden , 2017(Dearden , 2019. The theory of convenience suggests that the relative convenience of alternative actions determines decision-making when committing white-collar crime (Braaten and Vaughn 2019;Chan and Gibbs 2020;Gottschalk 2017Gottschalk , 2020Hansen 2020;Kireenko, Nevzorova, and Fedotov 2019;Vasiu and Podgor 2019).…”

Private policing of white-collar crime: case studies of internal investigations by fraud examiners

“…Braaten & Vaughn, 2019;Chan & Gibbs, 2020;P. Gottschalk, 2019;Hansen, 2020;Kireenko et al, 2019;Leasure & Zhang, 2018;Otu & Okon, 2019;Reese & McDougal, 2018;Vasiu & Podgor, 2019). White-collar offenders commit financial crime in the course of their occupations (Craig, 2019;Craig and Piquero, 2016;Dearden, 2017;Jordanoska, 2018;Onna and Denkers, 2019).…”

Corporate Crisis-Response Match

“…This and the previous chapter present and analyze accounts from thirteen corporate scandals based on Bundy and Pfarrer's (2015) zones of conformity. What emerges from our empirical study is the impression of convenience when corporations attempt to tackle an evolving scandal in their communications (Chan and Gibbs 2020;Gottschalk 2020;Hansen 2020;Kireenko et al 2019;Braaten and Vaughn 2019). Convenience is a term used to describe the potential savings in time and effort, as well as the potential avoidance of suffering and pain (Engdahl 2015).…”

“…As a relative construct, convenience is in line with decision-making among alternatives, where accounts can imply denial, justification, excuse, or apology. What is considered most convenient is decided by the corporation (Chan and Gibbs 2020;Gottschalk 2020;Hansen 2020;Kireenko et al 2019;Braaten and Vaughn 2019). Because of the overwhelming workload combined with a need to prioritize own time, convenience is often at the core of thinking among chief executives in organizations (Bigley and Wiersma 2002).…”