A NOVEL MACHINE LEARNING-BASED APPROACH FOR IDENTIFICATION OF UNREALISTIC TAX RETURNS BY EEG SIGNAL PROCESSING

For many years, the uncertainty of lie-detection systems has been one of the concerns of tax organizations. Clearly, the results of these systems must be generalized by a high value of accuracy to be acceptable by related systems to identify tax fraud. In this paper, a new method based on P300-based component has been proposed for detection of tax fraud. To this end, the test protocol is designed based on Odd-ball paradigm concealed information recognition. This test was done on 40 people and their brain signals were acquired. After prepossessing, the classic features are extracted from each single trial. After that, time–frequency (TF) transformation is applied on the sweeps and TF features are produced thereupon. Then, the best combinational feature vector is selected in order to improve classifier accuracy. Finally, guilty and innocent persons are classified by K-nearest neighbor (KNN) and multilayer perceptron (MLP) classifiers. We found that combination of time–frequency and classic features has better ability to achieve higher amount of accuracy to identify the unrealistic tax returns. The obtained results show that the proposed method can detect deception by the accuracy of 91% which is better than other previously reported methods. This study, for the first time, succeeded in presenting a novel method for identifying unrealistic tax returns through EEG signal processing, which has significantly improved the yield of this study compared to the previous literature.

Carousel fraud in terms of price manipulation

Purpose The purpose of this paper is to analyse the effects of carousel fraud on the average price of goods, as one of the negative economic aspects of carousel fraud. Design/methodology/approach This paper is primarily based on the description of selected legal cases and the modus operandi of carousel fraud, the analysis of legal texts (legislation and judgments of courts) and the discussion, from the point of view of price manipulation. Findings The results of the analysis specify the negative impact of carousel fraud in the form of the distortion of reported average prices and suggest that the authorities should monitor usual or fair prices to detect cases where there is a risk of carousel fraud. Originality/value This paper brings new insight into the issue of carousel frauds by understanding the principle of carousel fraud, the motives for it, and the possibilities for detecting this type of tax fraud, which is necessary to prevent tax evasion and to preserve a state’s income.

31. Critical perspectives on punishment

This chapter details a range of perspectives which effectively question the underlying assumptions behind the concept of ‘punishment’. This represents a shift in emphasis from the system ‘as it is’ to a critical evaluation of its social and ideological foundations, along with some ideas about how it might be different if we follow through the implications of these critical arguments. The chapter explores ideas about the use of punishment as a vehicle for maintaining the dominance of particular interests within society, and using it to exert social control. Implicated in this is the suggestion that claims of legitimacy, fairness, and justice must be called into question, especially in light of the evidence of the unequal treatment of certain groups, such as members of the black and minority ethnic communities. Critical perspectives also invite us to consider why some forms of behaviour, such as corporate negligence and tax fraud, appear to be much less heavily penalised (if at all) than crimes more typically associated with other groups and communities, such as benefit fraud or drug offences.

Criminogenic Dynamics of the Construction Industry: A State-Corporate Crime Perspective

Construction industries provide significant opportunities for criminal and harmful processes to occur, including fraud, tax evasion, poor health and safety, and underpayment of workers. Building on previous work from the state-corporate crime agenda, this article places industry at the forefront of discussion, by examining how “criminogenic industry structures” emerge in construction work. The article refers to the key instances of worker blacklisting and “umbrella company” tax fraud, situating them within broader discussions on systemic processes that enable state-corporate harm to develop. This paper contributes to the state-corporate crime agenda by demonstrating how discussions on criminogenic industry structures provide critical links between organizational processes and broader political-economic dynamics, which is crucial for developing a criminological discourse.

Money Laundering and Tax Crimes in Spain: Doctrine and Jurisprudence

As regulated in Spanish law, money laundering requires a prior illicit activity that has generated the assets that are the subject of laundering. One of the subjects that has been deeply discussed in recent years by certain doctrinal sectors, even with support in various jurisprudential rulings, has been the suitability of crimes against the Public Treasury, especially tax fraud, as the prior offence underlying money laundering. Thus, it has been debated whether the tax offender carrying out one of the activities typified in the Criminal Code (acquiring, possessing, using, converting or transmitting assets) automatically commits a type of money laundering. In that case, it would become an automatic and inevitable consequence of the tax crime itself. If, on the contrary, some other component must be required (essentially through the subjective elements of the unjust) to determine the existence of a second crime, that of money laundering, the prohibition of non-bis in idem confronts us, to a greater or lesser extent. Furthermore, doctrinal approaches and some judgements of the Spanish highest courts have generated a reinterpretation of the criminal law that fits badly with the principles of criminality. Nor is it easy to delineate the assets that are the object of the tax offence that may be subject to laundering, since, by definition, they are assets that were originally in possession of the offending subject and, besides, they are pecuniary obligations. To that extent, the presumption of innocence could, in many cases, determine the exoneration of the suspect.

VAT Efficiency—A Discussion on the VAT System in the European Union

The effectiveness of the tax system can be analysed in various ways. According to the authors one of manifestations of such effectiveness is resistance to tax evasion. This phenomenon is influenced by multiple factors, with few being the level of VAT rates and the number of rates in force in the country concerned. The aim of the considerations is therefore to analyse how the standard VAT rate as well as the number of rates affect the effectiveness of this tax. The research was based on a literature query in the field of value added tax in the European Union. In addition, the problem of tax evasion was indicated and the aggregated data on the size of the tax gap in the Member States were presented. Then, there are the results of the research for 27 European Union countries for 2011–2019. The efficiency of VAT collection was modelled using square function, determining the significance of the parameters of this function, as well as the value of abscissa, which made it possible to group the countries based on how they maintained the efficiency of VAT collection over the analysed period of time. The final part of the study concentrates on the relationship between the efficiency of tax collection and the amount of both the basic rate and the number of rates. The conclusions of the research are as follows: a tax system with a small number of reduced rates, and preferably with one relatively low standard rate, is the system least susceptible to tax fraud. The research also shows a positive correlation between the value of the basic VAT rate along with the number of preferential rates and the scale of the tax gap, i.e., in countries with a higher standard VAT rate and a greater number of preferential rates, the tax gap is greater. The study will enable further investigation into the strategy of determining the optimal VAT rate and the process of its unification. Proposed changes may contribute to increasing the efficiency of VAT administration in EU countries, reducing the shadow economy, tax fraud and positively influencing economic growth.