New Trends of International Tax Evasion - International Legal Regulations and Modern Combating Methods

• Author: Bogdan-Florian Amzuica, Roxana-Adriana Mititelu
• Profession: Bucharest University of Economic Studies, Romania/Bucharest University of Economic Studies, Romania
• Pages: 180-199

New Trends of International Tax Evasion - International Legal

Regulations and Modern Combating Methods

PhD. student Bogdan-Florian AMZUICĂ

1

PhD. student Roxana-Adriana MITITELU

2

Abstract

Within the contemporary market economy a nd the generalization of open type

economies, interdependent international economic relations have emerged based on an

open system of both economic and financial exchanges. They have contributed to the

emergence of new business relationships based on the international exchange of

outcrying type that did not involve, due to the dynamism as well as of the new economies

of the type of digital economies, and a quick adaptation of the customa ry normative

framework and of the legal framework to the new context. The o bjectives of this article

are represented by the identification of these new economic-social relations as well as of

the corresponding legal and normative framework and of the forms of circumvention of

the resulting taxation principles. The research meth ods used were qualitative methods

respectively descriptive methods as well as quantitative methods respectively indices and

aggregate economic indicators and econometric relations o f regressive and correlative

type. The results of the article aimed to identify new modern and self-contained meth ods

of combating international tax evasion, respectively the exchange of information and the

adequacy of the legal normative framework to the new economic realities. The

implications are complex and represent the identification of some methods of p reventing

unfair competition and of not distorting the mechanism of the international competition

market with implications on national budgets.

Keywords: international tax evasion, tax avoidance methods, money laundering,

offshore jurisdictions, cryptcurrencies.

JEL Classification: K14, K33, K34

1. Introduction

In the last period and here we are talking about the post-crisis period of

the crisis of 2008, it was accredited the idea that international economic

interdependence led to the development and propagation of some mechanisms of

transmission of the feedback of the economic-financial flows in the national

systems and that the mechanisms of self-regulation nationals cannot cope with

the resulting new dimensions.

As a result of the crisis, there have been several situations in which

1

Bogdan-Florian Amzuică – Bucharest University of Economic Studies, Romania, bogdanamzuica

@gmail.com.

2

Roxana-Adriana Mititelu - Bucharest University of Economic Studies, Romania, roxanamititelu

@gmail.com.

Dynamic Elements in the Contemporary Business Law 181

commercial economic entities have tried to hide the taxable sources of economic

activity within offshore jurisdictions.

Hiding the real beneficiary of the profits for various reasons: the real

beneficiary cannot have the legal status of associate and administrator in an

economic entity or there are prohibitions regarding the assets he can own

(measures for the confiscation of wealth, member of an organization criminal etc)

The profits obtained in another jurisdiction, the beneficiary does not want

to tax them in the national jurisdiction in order to circumvent the higher taxes and

to protect their own interests and accumulated assets. In particular, the countries

that undergo marked social and economic transformation processes, including

Romania, are facing multiple problems of fraud, organized crime and corruption,

which reach an alarming level. Fiscal evasion, speculative acts with legal

temptation and deception, money laundering operations become more socially

dangerous, fueled by the economic difficulties of the crisis of 2008, the lack of

procedural and legislative coherence or weakening of the coercive mechanisms

of governments, unable to provide the appropriate legal framework for a stable

society. The Romanian society for the last three decades has been characterized

by a major deficiency in the application of the rules of a coherent economy, but

also in a reversal of the value system, by which rudimentary capitalism has

determined the polarization of wealth. All these aspects have led to an escalation

of deviant behavior, as a "normal" phenomenon of adaptation to the state of

anomaly, within the meaning of the concept promoted by Durkheim

3

or as an

"innovative" behavior

4

.

2. Trends in international tax evasion

The international tax evasion aims to hide the tax base or to reduce it in

tax-favorable areas as well as transferring the funds anonymously in order to

protect them from the authorities in onshore or national areas. Thus, in order to

achieve this goal, tax subjects use certain legal or financial vehicles to conceal

the origin and purpose of the original transactions.

It is noteworthy in the last period the use of modern vehicles regarding

the international tax evasion which can be classified as follows:

1. Modern legal structures

2. Bitcoin and cryptocurrencies

3

Emile Durkheim, Diviziunea muncii sociale, Ed Antet, Bucharest, 2008, p. 32.

4

Robert K. Merton, The Unanticipated Consequence of Purposive Social Action, „American

Sociological Review”, 1(6), 1936, p. 894-904.