Tax Evasion and Ethics

Published on December 2016 | Categories: Documents | Downloads: 98 | Comments: 0 | Views: 317
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Submitted By: Ankur Agarwal Shivam Garg Nikunj Goenka Eshan Gupta Dipesh Jain Sashank Satapathy (E005) (E018) (E020) (E023) (E024) (E044)

 Who did it?

 eBay avoided £ 50m in tax
 Starbucks paid less than 1% tax on its profit  IKEA halved its tax bill  Former Italian Prime Minister Bersculoni  List goes on….

 How do they do it?

 Special Purpose Entities (SPEs)
 Sister Company  Round Tripping  Tax havens  Influencing audit committees

Who is affected?
 Government
 Less of taxes  Profits siphoned off to other countries  Fiscal deficit

 General public
 Less spending from govt., less benefits!

 Opinion too varied and depends on the culture  Greece has a major tax evasion problem  In India, Tax evasion is rampant  Specialized persons or firms guide on tax avoidance

 Another way is bribing the Income Tax officials

 The problem is more prevalent among the self

employed
 Even doctors, chartered accountants or property

valuators, ,builders , chartered engineer ,cine artists , tax consultants, stock brokers do tax evasion
 Reason for Tax evasion is lack of trust in government  Results into black money which causes illegal activities

 “Where there is business ethic, there is a long-term

bloom”.
Is there a company that can get success without ethics? From the facts, the answer seems to be “NO”  Whether Enron or Anderson or our own “Satyam”, they all finally paid for their Unethical Practices.  Arthur Anderson the one-time Big 5 accounting firm went entirely out of business, affecting 22,000 workers, most of whom had no connection to Enron.

 Fiercer statutory regulation of the auditing profession  Mandatory rotation of audit firms so that individuals

do not become too committed to their clients
 Stronger non-executive directors who can work as a check

against malpractices by powerful CEOs
 The Government should levy a minimum tax on annual

revenue earned by a Company

 Reputation management and competitive advantage  Enhanced social license to operate  Employee satisfaction

 Risk management
 Performances  Minimised environmental impacts

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