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Tax evasion in Brazil: the case of specialists

Felippe Clemente (Department of Economics, Federal University of Viçosa, Vicosa, Brazil)
Viviani Silva Lírio (Rural Economics Department, Federal University of Viçosa, Vicosa, Brazil)

Journal of Economic Studies

ISSN: 0144-3585

Article publication date: 14 May 2018

Issue publication date: 14 May 2018




The purpose of this paper is to use the instrumental game theory to understand the behavior of the front agents tax evasion and tax authority in Brazil.


In order to analyze the taxpayer’s behavior before the Brazilian tax system and tax actions aimed at reducing tax evasion, the authors developed a theoretical model based on the payoffs of Graetz et al. (1986) and increased with situations proposed by Siqueira (2004), Lipatov (2006) and Oliveira (2011).


Considering the cases with and without specialists, the main results show that in high dropout situation, penalize taxpayers with high fines or deprivations of liberty may not be as effective. Another result of the analysis is that the audit and inspection costs played an important role in driving the equilibrium system.

Research limitations/implications

One limitation of this study is to consider how the exogenous tax authorities earnings (Federal Revenue of Brazil and Federal Police) and not as a function of the goals and certain enforcement policies for each public body.

Practical implications

The authors suggest the following policy: investing in tax inspectors and unbureaucratic the authorities of the cost structure become a more effective tool to combat non-compliance with tax obligations that the intensity of the penalties imposed by the act of evading.


This paper contributes to the literature insofar as it models for the first time, using game theory, the behavior of the evading agent and the tax authority in Brazil.



Clemente, F. and Lírio, V.S. (2018), "Tax evasion in Brazil: the case of specialists", Journal of Economic Studies, Vol. 45 No. 2, pp. 401-410.



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