Tax Amnesty Programs
About Tax Amnesty Programs
Tax amnesty programs allow delinquent taxpayers to come forward, pay back taxes, and avoid penalties or prosecution. Italy has run multiple tax amnesties, raising billions but also encouraging future evasion by creating expectations of future amnesties. The US IRS has run several voluntary disclosure programs for offshore accounts. The 2009 and 2011 offshore voluntary disclosure programs collected over 5 billion. The 2012 OVDP ran until 2018. A 2014 streamlined filing compliance procedure was available for non willful violations. Research on tax amnesties is mixed. While they raise short term revenue, they may reduce long term compliance by creating moral hazard. Countries that use amnesties sparingly tend to have better compliance than those that use them frequently.
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