Tax Evasion

This week I will be exploring the white collar crime we know as tax evasion. Tax evasion is the illegal evasion of taxes by individuals, corporations, and trusts. These actions normally take place when taxpayers purposely lie about their information to tax authorities to reduce their tax liabilities. These activities include actions “such as declaring less income, profits or gains than the amounts actually earned, or overstating deductions.”(Wiki) When it comes to tax evasion a common act is the informal economy association. One stem of the problem would be the amount of unreported income, this is the difference between the amount of income that people are supposed to report to the tax authorities and the actual amount that people report. This is a very complex crimes of in my terms is like a person attempting to outsmart the system and run away with the dirty money they cheated to get. I will explain each aspect of this crime and show the effects it has on the system along with the economy.

With there being many different avenues or levels in a sense with this crime the penalties for such a crime also range like the different levels of the crime. In the seven titles of penalties for the crime the general punishment looks to be any fine ranging from $100,000 to $500,000(usually for corporations) and or a prison sentence ranging from 1 to 5 years. Aside from the prison time a person may have to endure following up after the crime, the amount of money a suspect is fined is to act as the aggressor of the penalty. Taking money out of the pockets of the government is something that won’t stay under their eye of detection for too long without being interfered. But some would argue someone needs to police the government because what they take away from people but to think from the perception of a person on the outside looking in it just might seem that we all just have our hands in each other’s pocket waiting for the right time to take while no one will notice.

If people believe that lying on their taxes and fixing their income for economic increase doesn’t affect our economy then they should do their research. “According to "The Guardian" newspaper, the U.S. economy lost an estimated $337 billion in 2014 as a result of illegal tax avoidance, or tax evasion.”(eHow) That is a huge dent on our economy, and just imagine where all of those dollars could have gone. And with this number seeming to appear higher in other studies, it just leaves me in a place of uncertainty on why people commit these crimes. “The taxes commonly evaded include federal and state income taxes and state and regional sales and real estate taxes.”(eHow) These are important factors and important money that is being taken from the government. Tax evasions rob the government of money that is needed to carry out laws and create a better environment for the country. This also reduces how effective our government is and hurts our economic status. “If $450 billion in revenue is lost to the federal government because of income tax evasion, then $450 billion in federal programs cannot be funded or, if funded, will have a negative effective on the national debt, which will grow by the same amount.”(example provided by Patrick Gleeson) I don’t think there is any more of an explanation needed to make the claim that this criminal action has an extreme negative effect on the economy.

Growing older and experiencing different things, I have to admit that I am more aware of the problems we have around us. Studying criminology has gave me an even insight on the crimes seen and unseen around us. All of white collar crime has a negative effect on the economy and each of them have their different levels on which they affect the system. Tax evasion is something I hear about all the time and my parents always stress to me the importance of doing all thing the right way so you won’t have to deal with the problems in the long run.

Work Cited

"Types and Schemesof White Collar Crime." TYPES OF WHITE COLLAR CRIME AND SCHEMES. N.p., n.d. Web. 23 Mar. 2016.

Patrick Gleeson, Ph. D., Registered Investment Adv. "How Does Tax Evasion Affect the Economy?" EHow. Demand Media, n.d. Web. 23 Mar. 2016.