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103-532: Throughout its history, the incinerator reportedly blew toxic and cancerous emissions over the neighbouring base facilities. The incinerator's owners, arrested and jailed for charges of tax evasion , neglected the maintenance of the facility. The pollution had become so much of a health concern for the American residents that if they showed signs of adverse health effects, the U.S. military authorities allowed them to leave early (usually service members are stationed at

206-558: A monarchy . In the 1920s the German sociologist Max Weber expanded the definition to include any system of administration conducted by trained professionals according to fixed rules. Weber saw bureaucracy as a relatively positive development; however, by 1944 the Austrian economist Ludwig von Mises opined in the context of his experience in the Nazi regime that the term bureaucracy

309-416: A "polar night of icy darkness", in which increasing rationalization of human life traps individuals in a soulless " iron cage " of bureaucratic, rule-based, rational control. Weber's critical study of the bureaucratization of society became one of the most enduring parts of his work. Many aspects of modern public administration are based on his work, and a classic, hierarchically organized civil service of

412-885: A bureaucracy was a government administration managed by departments staffed with non-elected officials. Today, bureaucracy is the administrative system governing any large institution, whether publicly owned or privately owned. The public administration in many jurisdictions is an example of bureaucracy, as is any centralized hierarchical structure of an institution, including corporations , societies , nonprofit organisations , and clubs . There are two key dilemmas in bureaucracy. The first dilemma revolves around whether bureaucrats should be autonomous or directly accountable to their political masters. The second dilemma revolves around bureaucrats' responsibility to follow preset rules, and what degree of latitude they may have to determine appropriate solutions for circumstances that are unaccounted for in advance. Various commentators have argued for

515-428: A centralized, bureaucratic government. The form of government created by the first emperor and his advisors was used by later dynasties to structure their own government. Under this system, the government thrived, as talented individuals could be more easily identified in the transformed society. The Han dynasty (202 BC – 220 AD) established a complicated bureaucracy based on the teachings of Confucius , who emphasized

618-611: A disjuncture: either the toppling of the ruling bureaucracy by means of a political revolution, or capitalist restoration led by the bureaucracy: The fall of the present bureaucratic dictatorship, if it were not replaced by a new socialist power, would thus mean a return to capitalist relations with a catastrophic decline of industry and culture. Writing in the early 1860s, political scientist John Stuart Mill theorized that successful monarchies were essentially bureaucracies, and found evidence of their existence in Imperial China ,

721-399: A government department would, and some governments have adopted this approach. In Bangladesh , customs administration was partly privatized in 1991. Abuse by private tax collectors (see tax farming below) has on occasion led to revolutionary overthrow of governments who have outsourced tax administration. Tax farming is an historical means of collection of revenue. Governments received

824-503: A huge scale. In August 2005, Bangladesh had hired four PSI companies – Cotecna Inspection SA, SGS (Bangladesh) Limited, Bureau Veritas BIVAC (Bangladesh) Limited and INtertek Testing Limited – for three years to certify price, quality and quantity of imported goods. In March 2008, the Bangladeshi National Board of Revenue cancelled Cotecna's certificate for serious irregularities, while importers' complaints about

927-453: A local level. At the apex of this system was the Shah, with total power over the state, legitimized by his bloodline as a sayyid , or descendant of Muhammad . To ensure transparency and avoid decisions being made that circumvented the Shah, a complex system of bureaucracy and departmental procedures had been put in place that prevented fraud. Every office had a deputy or superintendent, whose job

1030-479: A lower-taxed or untaxed jurisdiction with the intention of avoiding VAT or sales tax in their home jurisdiction are technically breaking the law in most cases. This is especially prevalent in federal countries like the United States and Canada where sub-national jurisdictions charge varying rates of VAT or sales tax. In liberal democracies, a fundamental problem with inhibiting evasion of local sales taxes

1133-399: A lump sum in advance from a private entity, which then collects and retains the revenue and bears the risk of evasion by the taxpayers. It has been suggested that tax farming may reduce tax evasion in less developed countries. This system may be liable to abuse by the "tax-farmers" seeking to make a profit, if they are not subject to political constraints. Abuses by tax farmers (together with

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1236-623: A multitude of inferior officers lay heavy on each territory." After the Empire split, the Byzantine Empire developed a notoriously complicated administrative hierarchy , and in the 20th century the term Byzantine came to refer to any complex bureaucratic structure. Uzun Hasan's conquest of most of mainland Iran shifted the seat of power to the east, where the Aq Qoyunlu adopted Iranian customs for administration and culture. In

1339-602: A national academy where officials would select candidates to take part in an examination of the Confucian classics , from which Emperor Wu would select officials. In the Sui dynasty (581–618) and the subsequent Tang dynasty (618–907) the shi class would begin to present itself by means of the fully standardized civil service examination system , of partial recruitment of those who passed standard exams and earned an official degree. Yet recruitment by recommendations to office

1442-473: A new health study is currently underway and should be released in the summer of 2009. Tax evasion Tax evasion is an illegal attempt to defeat the imposition of taxes by individuals, corporations , trusts , and others. Tax evasion often entails the deliberate misrepresentation of the taxpayer's affairs to the tax authorities to reduce the taxpayer's tax liability, and it includes dishonest tax reporting, declaring less income, profits or gains than

1545-404: A professor at Bryn Mawr College , Woodrow Wilson 's essay The Study of Administration argued for bureaucracy as a professional cadre, devoid of allegiance to fleeting politics. Wilson advocated a bureaucracy that: ...is a part of political life only as the methods of the counting house are a part of the life of society; only as machinery is part of the manufactured product. But it is, at

1648-616: A solid general education to enable inter-departmental transfers, and promotion should be through achievement rather than "preferment, patronage, or purchase". This led to implementation of His Majesty's Civil Service as a systematic, meritocratic civil service bureaucracy. In the British civil service, just as it was in China, entrance to the civil service was usually based on a general education in ancient classics, which similarly gave bureaucrats greater prestige. The Cambridge-Oxford ideal of

1751-427: A substantial amount of influence to preserve the current political system because they are primarily focused on defending the country and the state from threats from both within and beyond. Since these institutions frequently operate independently and are mostly shielded from politics, they frequently have no affiliation with any particular political party or group. For instance, loyal British civil officials work for both

1854-583: A tax system that exempted the aristocracy) were a primary reason for the French Revolution that toppled Louis XVI. Pre-shipment inspection agencies like Société Générale De Surveillance S. A. and its subsidiary Cotecna are in business to prevent evasion of customs duty through under-invoicing and misdeclaration. However, PSI agencies have cooperated with importers in evading customs duties. Bangladeshi authorities found Cotecna guilty of complicity with importers for evasion of customs duties on

1957-427: Is a serious problem for the tax administration in many countries. Tax evasion is a crime in almost all developed countries, and the guilty party is liable to fines and/or imprisonment . In Switzerland , many acts that would amount to criminal tax evasion in other countries are treated as civil matters. Dishonestly misreporting income in a tax return is not necessarily considered a crime. Such matters are handled in

2060-563: Is characterized by: Weber listed several preconditions for the emergence of bureaucracy, including an increase in the amount of space and population being administered, an increase in the complexity of the administrative tasks being carried out, and the existence of a monetary economy requiring a more efficient administrative system. Development of communication and transportation technologies make more efficient administration possible, and democratization and rationalization of culture results in demands for equal treatment . Although he

2163-604: Is mainly a centralized form of management and tends to be differentiated from adhocracy , in which management tends more to decentralization . Although the term bureaucracy first originated in the mid-18th century, organized and consistent administrative systems existed much earlier. The development of writing ( c. 3500 BC) and the use of documents was a critical component of such systems. The first definitive example of bureaucracy occurred in ancient Sumer , where an emergent class of scribes used clay tablets to document and carry out various administrative functions, such as

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2266-478: Is required to resolve the theoretical ambiguities. Income tax evasion appears to be positively influenced by the tax rate , the unemployment rate , the level of income and dissatisfaction with government. The U.S. Tax Reform Act of 1986 appears to have reduced tax evasion in the United States. In a 2017 study Alstadsæter et al. concluded based on random stratified audits and leaked data that occurrence of tax evasion rises sharply as amount of wealth rises and that

2369-423: Is stored in tax havens stays undetected in random audits. Even though there is high diversity among people who evade taxes, there is a higher probability among the highest wealth group. According to Alstadsæter, Johannesen and Zucman 2019 the extent of taxes evaded is substantially higher with higher income, and exceptionally higher among people of the top wealth group. In line with this, the probability to appear in

2472-452: Is that liberal democracies, by their very nature, have few (if any) border controls between their internal jurisdictions. Therefore, it is not generally cost-effective to enforce tax collection on low-value goods carried in private vehicles from one jurisdiction to another with a different tax rate. However, sub-national governments will normally seek to collect sales tax on high-value items such as cars. One reason for taxpayers to evade taxes

2575-489: Is the legal use of tax laws to reduce one's tax burden. Both tax evasion and tax avoidance can be viewed as forms of tax noncompliance , as they describe a range of activities that intend to subvert a state's tax system, but such classification of tax avoidance is disputable since avoidance is lawful in self-creating systems. Both tax evasion and tax avoidance can be practiced by corporations, trusts, or individuals. In 1968, Nobel laureate economist Gary Becker first theorized

2678-402: Is the personal benefits that come with it, thus the individual problems that lead to that decision Additionally, Wallschutzky's exchange relationship hypothesis presents as a sufficient motive for many. The exchange relationship hypothesis states that tax payers believe that the exchange between their taxes and the public good/social services as unbalanced. Furthermore, the little capability of

2781-683: Is the state which has really made itself into civil society." Leon Trotsky developed a critical theory of the emerging Soviet bureaucracy during the early years of the Soviet Union. According to political scientist Thomas M. Twiss, Trotsky associated bureaucratism with authoritarianism , excessive centralism and conservatism . Social theorist Martin Krygier had noted the impact of Trotsky's post-1923 writings in shaping receptive views of bureaucracy among later Marxists and many non-Marxists. Twiss argued that Trotsky's theory of Soviet bureaucracy

2884-742: The Ashanti Empire was built upon a sophisticated bureaucracy in Kumasi , with separate ministries which saw to the handling of state affairs. Ashanti's Foreign Office was based in Kumasi. Despite the small size of the office, it allowed the state to pursue complex negotiations with foreign powers. The Office was divided into departments that handled Ashanti relations separately with the British , French , Dutch , and Arabs . Scholars of Ashanti history, such as Larry Yarak and Ivor Wilkes , disagree over

2987-491: The Panama Papers rises significantly among the top 0.01% of the wealth group, as does the probability to own an unreported account at HSBC. However, the upper wealth group is also more inclined to use tax amnesty. Bureaucracy Bureaucracy ( / b j ʊəˈr ɒ k r ə s i / ; bure- OK -rə-see ) is a system of organization where decisions are made by a body of non-elected officials. Historically,

3090-670: The Qing dynasty collapsed, marking the end of China's traditional bureaucratic system. A hierarchy of regional proconsuls and their deputies administered the Roman Empire . The reforms of Diocletian (Emperor from 284 to 305) doubled the number of administrative districts and led to a large-scale expansion of Roman bureaucracy. The early Christian author Lactantius ( c. 250 – c. 325) claimed that Diocletian's reforms led to widespread economic stagnation, since "the provinces were divided into minute portions, and many presidents and

3193-537: The Russian Empire , and the regimes of Europe . Mill referred to bureaucracy as a distinct form of government, separate from representative democracy. He believed bureaucracies had certain advantages, most importantly the accumulation of experience in those who actually conduct the affairs. Nevertheless, he believed this form of governance compared poorly to representative government, as it relied on appointment rather than direct election. Mill wrote that ultimately

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3296-433: The economics of crime , on the basis of which authors M.G. Allingham and A. Sandmo produced, in 1972, an economic model of tax evasion. This model deals with the evasion of income tax, the main source of tax revenue in developed countries. According to the authors, the level of evasion of income tax depends on the detection probability and the level of punishment provided by law. Later studies, however, pointed limitations of

3399-410: The mohrdar , who affixed the state seal; and the marakur ' stable master ' , who supervised the royal court. Through the use of his increasing revenue, Uzun Hasan was able to buy the approval of the ulama (clergy) and the mainly Iranian urban elite, while also taking care of the impoverished rural inhabitants. The Safavid state was one of checks and balance, both within the government and on

3502-581: The 2008 tax gap found a range of $ 450–$ 500 billion, and unreported income to be about $ 2 trillion, concluding that 18 to 19 percent of total reportable income was not being properly reported to the IRS. Generally, individuals tend to evade taxes, while companies rather avoid taxes. There is a great heterogenic among people who evade people as it is a substantial issue in society, that is creating an excessive tax gap. Studies suggest that 8% of global financial wealth lies in offshore accounts. Often, offshore wealth that

3605-534: The British model also took personal physique and character into account. Like the British, the development of French bureaucracy was influenced by the Chinese system. Under Louis XIV of France , the old nobility had neither power nor political influence, their only privilege being exemption from taxes. The dissatisfied noblemen complained about this "unnatural" state of affairs, and discovered similarities between absolute monarchy and bureaucratic despotism . With

3708-452: The CTA seeks to mitigate the misuse of shell companies for tax evasion purposes and bolster efforts to combat financial crimes within the U.S. jurisdiction. As of 2007 the most common means of tax evasion was overstatement of charitable contributions, particularly church donations. The IRS estimates that the 2001 tax gap was $ 345 billion and that the 2006 tax gap was $ 450 billion. A study of

3811-464: The Catholic Church, he pointed out that bureaucracy is only appropriate for an organization whose code of conduct is not subject to change. He then went on to argue that complaints about bureaucratization usually refer not to the criticism of the bureaucratic methods themselves, but to "the intrusion of bureaucracy into all spheres of human life." Mises saw bureaucratic processes at work in both

3914-498: The Chinese. The governments of China, Egypt, Peru and Empress Catherine II were regarded as models of Enlightened Despotism, admired by such figures as Diderot, D'Alembert and Voltaire. Napoleonic France adopted this meritocracy system and soon saw a rapid and dramatic expansion of government, accompanied by the rise of the French civil service and its complex systems of bureaucracy. This phenomenon became known as "bureaumania". In

4017-461: The Continental type is called a "Weberian civil service" or a "Weberian bureaucracy". Social scientists debate whether Weberian bureaucracy contributes to economic growth . Political scientist Jan Vogler challenges Max Weber's characterization of modern bureaucracies. Whereas Weber describes bureaucracies as entailing strict merit recruitment, clearly delineated career-paths for bureaucrats,

4120-931: The European treasuries through suspected fraud and speculation with dividend tax. The five hardest hit countries have lost together at least $ 62.9 billion. Germany is the hardest hit country, with around €31 billion withdrawn from the German treasury. Estimated losses for other countries include at least €17 billion for France, €4.5 billion in Italy, €1.7 billion in Denmark and €201 million for Belgium. A paper by economists Annette Alstadsæter, Niels Johannesen and Gabriel Zucman, which used data from HSBC Switzerland (" Swiss leaks ") and Mossack Fonseca (" Panama Papers "), found that "on average about 3% of personal taxes are evaded in Scandinavia, but this figure rises to about 30% in

4223-478: The Exchequer George Osborne promised to collect £5 billion by "waging war" on tax evaders by announcing new powers for HMRC to target people with offshore bank accounts. The number of people prosecuted for tax evasion doubled in 2014/15 from the year before to 1,258. In the United States of America, Federal tax evasion is defined as the purposeful, illegal attempt to evade the assessment or

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4326-555: The Iranian areas, Uzun Hasan preserved the previous bureaucratic structure along with its secretaries, who belonged to families that had in a number of instances served under different dynasties for several generations. The four top civil posts of the Aq Qoyunlu were all occupied by Iranians, which under Uzun Hasan included: the vizier, who led the great council ( divan ); the mostawfi al-mamalek , high-ranking financial accountants;

4429-563: The Pandora Papers also cites that the former Managing Director of IMF and French finance minister, Dominique Strauss-Kahn was permitted to create a consulting firm in the United Arab Emirates in 2018 after the expiry of tax exemptions of his Moroccan company, which he used for receiving millions of dollars worth of tax free consulting fees. A network of banks, stock traders and top lawyers has obtained billions from

4532-501: The Swiss tax courts, not the criminal courts. In Switzerland, however, some tax misconduct (such as the deliberate falsification of records) is criminal. Moreover, civil tax transgressions may give rise to penalties. It is often considered that the extent of evasion depends on the severity of punishment for evasion. Professor Christopher Hood first suggested privatization of tax enforcement to control tax evasion more efficiently than

4635-523: The UK tax collection agency stated that it would continue to crack down on tax evasion, with the goal of collecting £18 billion in revenue before 2015. In 2010, HMRC began a voluntary amnesty program that targeted middle-class professionals and raised £500 million. Corrupt tax officials co-operate with the taxpayers who intend to evade taxes. When they detect an instance of evasion, they refrain from reporting it in return for bribes . Corruption by tax officials

4738-489: The USN has been reluctant to address their concerns. The incinerator contaminated the base, especially the housing area, with dioxin, heavy metals, and other deadly toxins. In June, 2007, the USN's Environmental Health Center announced that it would conduct a study of the health population of those stationed at NAF Atsugi during the time the incinerator was in operation. The Navy and Marine Corps Public Health Center has stated that

4841-456: The amount of money a person or a corporation possesses. Efforts to evade income tax decline when the amounts involved are lower. The level of evasion also depends on the efficiency of the tax administration. Corruption by tax officials makes it difficult to control evasion. Tax administrations use various means to reduce evasion and increase the level of enforcement: for example, privatization of tax enforcement or tax farming. In 2011 HMRC ,

4944-441: The amounts actually earned, overstating deductions, bribing authorities and hiding money in secret locations. Tax evasion is an activity commonly associated with the informal economy . One measure of the extent of tax evasion (the "tax gap") is the amount of unreported income, which is the difference between the amount of income that the tax authority requests be reported and the actual amount reported. In contrast, tax avoidance

5047-483: The apparatus used by the British government to subjugate Ireland as "the Bureaucratie, or office tyranny, by which Ireland has so long been governed". By the mid-19th century the word appeared in a more neutral sense, referring to a system of public administration in which offices were held by unelected career officials. In this context bureaucracy was seen as a distinct form of management , often subservient to

5150-441: The associated bureaucracy. Politicians like Margaret Thatcher and Ronald Reagan gained power by promising to eliminate government regulatory bureaucracies, which they saw as overbearing, and return economic production to a more purely capitalistic mode, which they saw as more efficient. In the business world, managers like Jack Welch gained fortune and renown by eliminating bureaucratic structures inside corporations. Still, in

5253-572: The base for a tour of three years). Many U.S. service members reported sickness and a few died from cancer shortly after moving back to the United States . However, the US Navy has not formally established a connection between their exposure and their disease. For a time, the base required service members to undergo medical screenings before being stationed at the base in order to ensure that they had no medical condition that would be worsened by

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5356-669: The bureaucracy stifles the mind, and that "a bureaucracy always tends to become a pedantocracy." The fully developed bureaucratic apparatus compares with other organisations exactly as does the machine with the non-mechanical modes of production. –Max Weber The German sociologist Max Weber (1864-1920) was the first to study bureaucracy formally, and his works led to the popularization of this term. In his essay Bureaucracy , published in his magnum opus , Economy and Society in 1921, Weber described many ideal-typical forms of public administration , government, and business . His ideal-typical bureaucracy, whether public or private,

5459-469: The civil service was identical to the Confucian ideal of a general education in world affairs through humanism. Well into the 20th century, classics, literature, history and language remained heavily favoured in British civil service examinations. In the period of 1925–1935, 67 percent of British civil service entrants consisted of such graduates. Like the Chinese model's consideration of personal values,

5562-502: The discovery of a universal and uniform underlying structure of managerial or work levels in the bureaucratic hierarchy for any type of employment systems. Jaques argues and presents evidence that for the bureaucracy to provide a valuable contribution to the open society some of the following conditions must be met: Like every modern state, a liberal democracy is highly bureaucratized, with numerous sizable organizations filled with career civil servants . Some of those bureaucracies have

5665-589: The earlier Chinese model. By the mid-19th century, bureaucratic forms of administration were firmly in place across the industrialized world. Thinkers like John Stuart Mill and Karl Marx began to theorize about the economic functions and power-structures of bureaucracy in contemporary life. Max Weber was the first to endorse bureaucracy as a necessary feature of modernity, and by the late 19th century bureaucratic forms had begun their spread from government to other large-scale institutions. Within capitalist systems, informal bureaucratic structures began to appear in

5768-409: The early 19th century, Napoleon attempted to reform the bureaucracies of France and other territories under his control by the imposition of the standardized Napoleonic Code . But paradoxically, that led to even further growth of the bureaucracy. French civil service examinations adopted in the late 19th century were also heavily based on general cultural studies. These features have been likened to

5871-694: The forces of change brought on by the Industrial Revolution propelled many countries, especially in Europe, to significant social changes. However, due to the conservative nature of the Tsarist regime and its desire to maintain power and control, social change in Russia lagged behind that of Europe. Russian-speakers referred to bureaucrats as chinovniki ( чиновники ) because of the rank or chin ( чин ) which they held. The government of

5974-528: The form of corporate power hierarchies, as detailed in mid-century works like The Organization Man and The Man in the Gray Flannel Suit . Meanwhile, in the Soviet Union and Eastern Bloc nations, a powerful class of bureaucratic administrators termed nomenklatura governed nearly all aspects of public life. The 1980s brought a backlash against perceptions of "big government" and

6077-417: The foundation that tax compliance is costly for individuals as well as firms (tax filling, bureaucracy ), hence not paying taxes would be more economical in their opinion. Customs duties are an important source of revenue in developing countries. Importers attempt to evade customs duty by (a) under-invoicing and (b) misdeclaration of quantity and product-description. When there is ad valorem import duty,

6180-638: The full separation of bureaucratic operations from politics, and mutually exclusive spheres of competence for government agencies, Vogler argues that the overwhelming majority of existing public administrative systems are not like this. Instead, modern bureaucracies require only "minimal competence" from candidates for bureaucratic offices, leaving space for biases in recruitment processes that give preferential treatment to members of specific social, economic, or ethnic groups, which are observed in many real-world bureaucratic systems. Bureaucracies are also not strictly separated from politics. Writing as an academic while

6283-478: The good government which consists in the advancement of men of talent and merit only", and that the British must reform their civil service by making the institution meritocratic . Influenced by the ancient Chinese imperial examination , the Northcote–Trevelyan Report of 1854 recommended that recruitment should be on the basis of merit determined through competitive examination, candidates should have

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6386-426: The importance of ritual in family, relationships, and politics. With each subsequent dynasty, the bureaucracy evolved. In 165 BC, Emperor Wen introduced the first method of recruitment to civil service through examinations. Emperor Wu (r. 141–87 BC) cemented the ideology of Confucius into mainstream governance by installing a system of recommendation and nomination in government service known as xiaolian , and

6489-579: The late 18th century, the ratio of fiscal bureaucracy to population in Britain was approximately 1 in 1300, almost four times larger than the second most heavily bureaucratized nation, France. Thomas Taylor Meadows , Britain's consul in Guangzhou , argued in his Desultory Notes on the Government and People of China (1847) that "the long duration of the Chinese empire is solely and altogether owing to

6592-510: The latter makes for progress and improvement." American sociologist Robert K. Merton expanded on Weber's theories of bureaucracy in his work Social Theory and Social Structure , published in 1957. While Merton agreed with certain aspects of Weber's analysis, he also noted the dysfunctional aspects of bureaucracy, which he attributed to a "trained incapacity" resulting from "over conformity". He believed that bureaucrats are more likely to defend their own entrenched interests than to act to benefit

6695-510: The management of taxes, workers, and public goods/resources like granaries. Similarly, Ancient Egypt had a hereditary class of scribes that administered a civil-service bureaucracy. In China , when the Qin dynasty (221–206 BC) unified China under the Legalist system, the emperor assigned administration to dedicated officials rather than nobility, ending feudalism in China, replacing it with

6798-520: The mid-18th century. Gournay never wrote the term down but a letter from a contemporary later quoted him: The late M. de Gournay... sometimes used to say: "We have an illness in France which bids fair to play havoc with us; this illness is called bureaumania." Sometimes he used to invent a fourth or fifth form of government under the heading of "bureaucracy." The first known English-language use dates to 1818 with Irish novelist Lady Morgan referring to

6901-480: The model, highlighting that individuals are also more likely to comply with taxes when they believe that tax money is appropriately used and when they can take part on public decisions. The literature's theoretical models are elegant in their effort to identify the variables likely to affect non-compliance. Alternative specifications, however, yield conflicting results concerning both the signs and magnitudes of variables believed to affect tax evasion. Empirical work

7004-464: The modern world, most organized institutions rely on bureaucratic systems to manage information, process records, and administer complex systems, although the decline of paperwork and the widespread use of electronic databases is transforming the way bureaucracies function. Karl Marx theorized about the role and function of bureaucracy in his Critique of Hegel's Philosophy of Right , published in 1843. In Philosophy of Right , Hegel had supported

7107-434: The necessity of bureaucracies in modern society. The German sociologist Max Weber argued that bureaucracy constitutes the most efficient and rational way in which human activity can be organized and that systematic processes and organized hierarchies are necessary to maintain order, maximize efficiency , and eliminate favoritism. On the other hand, Weber also saw unfettered bureaucracy as a threat to individual freedom , with

7210-437: The organization as a whole but that pride in their craft makes them resistant to changes in established routines. Merton stated that bureaucrats emphasize formality over interpersonal relationships, and have been trained to ignore the special circumstances of particular cases, causing them to come across as "arrogant" and "haughty". In his book A General Theory of Bureaucracy , first published in 1976, Elliott Jaques describes

7313-560: The other three PSI companies mounted. Bangladesh planned to have its customs department train its officials in " WTO valuation , trade policy, ASYCUDA system, risk management" to take over the inspections. Cotecna was also found to have bribed Pakistan's prime minister Benazir Bhutto to secure a PSI contract by Pakistani importers. She and her husband were sentenced both in Pakistan and Switzerland. In early October 2021, 11.9 million leaked financial records in addition to 2.9 TB of data

7416-523: The overwhelming majority of states instead collect sales taxes . Canada uses both a VAT at the federal level (the Goods and Services Tax ) and sales taxes at the provincial level ; some provinces have a single tax combining both forms . In addition, most jurisdictions which levy a VAT or sales tax also legally require their residents to report and pay the tax on items purchased in another jurisdiction. This means that consumers who purchase something in

7519-446: The payment of a tax imposed by federal law. Conviction of tax evasion may result in fines and imprisonment, such as five years in prison on each count of tax evasion. The Internal Revenue Service (IRS) has identified small businesses and sole proprietors as the largest contributors to the tax gap between what Americans owe in federal taxes and what the federal government receives. Small businesses and sole proprietorships contribute to

7622-456: The poor air quality. In May 2001, the Japanese government purchased the plant for nearly 40 million dollars and shut it down following a United States Department of Justice lawsuit against the private incinerator owner. Dismantling was completed by the end of that year. Some former residents of Atsugi NAF still complain of health problems related to the incinerator's emissions and report that

7725-510: The potential of trapping individuals in an impersonal " iron cage " of rule-based, rational control. The term bureaucracy originated in the French language : it combines the French word bureau – ' desk ' or ' office ' – with the Greek word κράτος ( kratos ) – ' rule ' or ' political power '. The French economist Jacques Claude Marie Vincent de Gournay coined the word in

7828-559: The power of this sophisticated bureaucracy in comparison to the Asantehene . However, both scholars agree that it was a sign of a highly developed government with a complex system of checks and balances . Instead of the inefficient and often corrupt system of tax farming that prevailed in absolutist states such as France, the Exchequer was able to exert control over the entire system of tax revenue and government expenditure. By

7931-492: The pressure of being under surveillance and had to make sure they governed in the best interest of their leader, and not merely their own. The Ottomans adopted Persian bureaucratic traditions and culture. Defunct The Russian autocracy survived the Time of Troubles and the rule of weak or corrupt tsars because of the strength of the government's central bureaucracy. Government functionaries continued to serve, regardless of

8034-459: The private and public spheres; however, he believed that bureaucratization in the private sphere could only occur as a consequence of government interference. According to him, "What must be realized is only that the strait jacket of bureaucratic organization paralyzes the individual's initiative, while within the capitalist market society an innovator still has a chance to succeed. The former makes for stagnation and preservation of inveterate methods,

8137-408: The role of specialized officials in public administration , although he never used the term bureaucracy himself. By contrast, Marx was opposed to bureaucracy. Marx posited that while corporate and government bureaucracy seem to operate in opposition, in actuality they mutually rely on one another to exist. He wrote that "The Corporation is civil society's attempt to become state; but the bureaucracy

8240-399: The ruler's legitimacy or the boyar faction controlling the throne. In the 17th century, the bureaucracy expanded dramatically. The number of government departments ( prikazy ; sing., prikaz ) increased from twenty-two in 1613 to eighty by mid-century. Although the departments often had overlapping and conflicting jurisdictions , the central government, through provincial governors,

8343-563: The same time, tax avoidance was estimated at £1.7 billion (this does not include international tax arrangements that cannot be challenged under the UK law, including some forms of base erosion and profit shifting (BEPS)). In 2013, the Coalition government announced a crackdown on economic crime . It created a new criminal offence for aiding tax evasion and removed the requirement for tax investigation authorities to prove "intent to evade tax" to prosecute offenders. In 2015, Chancellor of

8446-405: The same time, raised very far above the dull level of mere technical detail by the fact that through its greater principles it is directly connected with the lasting maxims of political wisdom, the permanent truths of political progress. Wilson did not advocate a replacement of rule by the governed, he simply advised that, "Administrative questions are not political questions. Although politics sets

8549-413: The service in question cannot be subjected to economic calculation, bureaucratic management is necessary. He did not oppose universally bureaucratic management; on the contrary, he argued that bureaucracy is an indispensable method for social organization, for it is the only method by which the law can be made supreme, and is the protector of the individual against despotic arbitrariness. Using the example of

8652-422: The system to catch the tax evaders reduces associated risk. Most often, it is more economical to evade taxes, being caught and paying a fine as a consequence, than paying the accumulated tax burden over the years. Thus, evasion numbers should be even higher than they are, hence for many people there seem to be moral objective countering this practice. The level of evasion depends on a number of factors, including

8755-586: The tasks for administration, it should not be suffered to manipulate its offices". This essay became a foundation for the study of public administration in America. In his 1944 work Bureaucracy , the Austrian economist Ludwig von Mises compared bureaucratic management to profit management. Profit management, he argued, is the most effective method of organization when the services rendered may be checked by economic calculation of profit and loss. When, however,

8858-442: The tax base can be reduced through under-invoicing. Misdeclaration of quantity is more relevant for products with specific duty. Production description is changed to match a H. S. Code commensurate with a lower rate of duty. Smuggling is import or export of products by illegal means. Smuggling is resorted to for total evasion of customs duties, as well as for the import and export of contraband . Smugglers do not pay duty since

8961-509: The tax gap because there are few ways for the government to know about skimming or non-reporting of income without mounting significant investigations. Shell companies have historically been utilized as vehicles for tax evasion and other illicit financial activities due to their opaque ownership structures. These entities, often devoid of substantial operations or assets, allow individuals to conceal their true identities and assets, thereby evading taxes and facilitating money laundering. Recognizing

9064-514: The tax havens of Bahamas and British Virgin Islands through an Emirati company, partially owned by an investment conglomerate, Dubai Holding and Axiom Limited, major shares of which were owned by the ruler. As per the leaked records, the Dubai ruler owned a massive number of upmarket and luxurious real estate across Europe via the cited offshore entities registered in tax havens. Additionally,

9167-513: The top 0.01% of the wealth distribution... Taking tax evasion into account increases the rise in inequality seen in tax data since the 1970s markedly, highlighting the need to move beyond tax data to capture income and wealth at the top, even in countries where tax compliance is generally high. We also find that after reducing tax evasion—by using tax amnesties—tax evaders do not legally avoid taxes more. This result suggests that fighting tax evasion can be an effective way to collect more tax revenue from

9270-637: The translation of Confucian texts during the Enlightenment , the concept of a meritocracy reached intellectuals in the West, who saw it as an alternative to the traditional ancien regime of Europe. Western perception of China even in the 18th century admired the Chinese bureaucratic system as favourable over European governments for its seeming meritocracy; Voltaire claimed that the Chinese had "perfected moral science" and François Quesnay advocated an economic and political system modeled after that of

9373-447: The transport is covert, so no customs declaration is made. During the second half of the 20th century, value-added tax (VAT) emerged as a modern form of consumption tax throughout the world, with the notable exception of the United States . Producers who collect VAT from consumers may evade tax by under-reporting the amount of sales. The US has no broad-based consumption tax at the federal level, and no state currently collects VAT;

9476-461: The ultra-wealthy." HMRC , the UK tax collection agency, estimated that in the tax year 2016–17, pure tax evasion (i.e. not including things like hidden economy or criminal activity) cost the government £5.3 billion. This compared to a wider tax gap (the difference between the amount of tax that should, in theory, be collected by HMRC, against what is actually collected) of £33 billion in the same year, an amount that represented 5.7% of liabilities. At

9579-401: The underpayment (or remittance) gap. Voluntary tax compliance in the U.S. is approximately 85% of taxes actually due, leaving a gross tax gap of about 15%. The tax gap is growing mainly because of two factors, the lack of enforcement on the one hand and the lack of compliance on the other hand. The former is mainly rooted in the costly enforcement of the taxation law. The latter is based on

9682-400: The very richest are about 10 times more likely than average people to engage in tax evasion. The tax gap describes how much tax should have been raised in relation to much tax is actually raised. The IRS defines the gross tax gap as the difference between the true tax liability for a given year and the taxes actually remitted on time. It comprises the nonfiling gap, the underreporting gap, and

9785-589: The vulnerabilities posed by such practices, the United States enacted the Corporate Transparency Act (CTA). The CTA mandates that companies disclose their beneficial owners to the Financial Crimes Enforcement Network (FinCEN) , aiming to dismantle the anonymity of shell corporations and increase transparency in corporate ownership. By requiring comprehensive reporting of beneficial ownership information (BOI),

9888-401: The word is used very often to blame complicated rules, processes, and written work that are interpreted as obstacles rather than safeguards and accountability assurances. Socio-bureaucracy would then refer to certain social influences that may affect the function of a society. In modern usage, modern bureaucracy has been defined as comprising four features: Bureaucracy in a political theory

9991-473: Was "always applied with an opprobrious connotation", and by 1957 the American sociologist Robert Merton suggested that the term bureaucrat had become an " epithet , a Schimpfwort " in some circumstances. The word bureaucracy is also used in politics and government with a disapproving tone to disparage official rules that appear to make it difficult—by insistence on procedure and compliance to rule, regulation, and law—to get things done. In workplaces,

10094-661: Was able to control and regulate all social groups, as well as trade, manufacturing, and even the Eastern Orthodox Church . The tsarist bureaucracy , alongside the military , the judiciary and the Russian Orthodox Church , played a major role in solidifying and maintaining the rule of the Tsars in the Tsardom of Russia (1547–1721) and in the Russian Empire (1721–1917). In the 19th century,

10197-467: Was essential for a study of Soviet history and understanding the process of capitalist restoration in Russia and Eastern Europe. Political scientist, Baruch Knei-Paz argued Trotsky had, above all others, written "to show the historical and social roots of Stalinism" as a bureaucratic system. One of the predictions made by Trotsky in his 1936 work, The Revolution Betrayed , was that the USSR would come before

10300-450: Was not necessarily an admirer of bureaucracy, Weber saw bureaucratization as the most efficient and rational way of organizing human activity and therefore as the key to rational-legal authority , indispensable to the modern world. Furthermore, he saw it as the key process in the ongoing rationalization of Western society . Weber also saw bureaucracy, however, as a threat to individual freedoms, and ongoing bureaucratization as leading to

10403-580: Was released in the name of Pandora Papers by the International Consortium of Investigative Journalists (ICIJ), exposing the secret offshore accounts of around 35 world leaders in tax havens to evade taxes. One of the many leaders to be exposed was the ruler of Dubai and prime minister of the United Arab Emirates, Sheikh Mohammed bin Rashid al-Maktoum . Sheikh Mohammed was identified as the shareholder of three firms that were registered in

10506-539: Was still prominent in both dynasties. It was not until the Song dynasty (960–1279) that the recruitment of those who passed the exams and earned degrees was given greater emphasis and significantly expanded. During the Song dynasty (960–1279) the bureaucracy became meritocratic . Following the Song reforms, competitive examinations took place to determine which candidates qualified to hold given positions. The imperial examination system lasted until 1905, six years before

10609-455: Was to keep records of all actions of the state officials and report directly to the Shah. The Shah himself exercised his own measures for keeping his ministers under control by fostering an atmosphere of rivalry and competitive surveillance. And since the Safavid society was meritocratic, and successions seldom were made on the basis of heritage, this meant that government offices constantly felt

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