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Fabio Privileggi

Membro Associato a POLIS
Ufficio 307
Via Cavour 84, 15121 Alessandria

email: fabio.privileggi@unito.it
Fax: 0131 283 704





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MARCHESE Carla and Fabio PRIVILEGGI (2009), "A Model of the Italian Cut-off System for Taxing Small Businesses", Research in Economics, 63 (2), 127 - 134.
J.E.L codes: H25, H26, K42
Keywords: tax evasion by firms, cut-off rule

Abstract
The Studi di Settore are used by the Italian tax administration to calculate reference revenue levels for small businesses and provide a kind of cut-off level for tax audits. Recently new rules have been introduced in order to render the Studi di Settore more efficient in producing realistic estimates, with the aim of reducing the "legalized evasion" that might arise in case of a systematic downward bias. Voices of the involved categories, however, convinced the Government to partially step back. Building upon the standard firm's tax evasion model of Cowell (2004) and the approach of Santoro (2006) we show that, under given conditions, a stringency increase might backfire implying a larger overall tax evasion and a smaller tax revenue.

link to journal article
Research Project: I meccanismi di controllo a soglia: una verifica sperimentale More...

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