One of the major sources of revenue for the government is Tax. The government spends the tax that it collected on various activities which include nation building and social welfare of citizens and residents. The government charges tax to individuals and corporates as per the tax provision in the country, but there have been many incidences where the payers have not paid taxes to the government. The countrys tax authority is empowered to implement the tax laws and also penalise those dodging payments. It takes various measures to reduce the possibility of tax evasion and tax avoidance. Since tax revenue is an important source of income, tax evasion and avoidance affect the countrys economic growth and development.

You are requested:

A) To write a detailed report and analyse any five possible reasons & techniques used by individuals and corporates to avoid and/or evade tax.

B) To write a detailed report on impact of tax evasion on the economic situation of a country and measures that can be taken by tax authorities to remove such practises.