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TAX LAW - Taxation of illegal activities in Your countries. Help needed

post #1 of 16
Thread Starter 

I'm looking (for my scientific work) for any informations about tax law in Your countries. Any countries but I care most about Japan (!!), India, South Korea, Spain, Italy, Austria, Norway, Sweden, Canada, Australia, USA, Russia, Turkey, Israel. I need (desperately) informations (law rules, articles, books) on:

- Taxation of illegal activities,

- Taxation of invalid legal transactions ,

- Taxation of actions contrary to law or public policy ,

- Taxation of immoral activities.

 

You can send me informations in original language if there is no english translations.

 

Please help.


Edited by asmagus - 6/20/12 at 2:38am
post #2 of 16

You mean punishment instead of taxing?

post #3 of 16
Thread Starter 

No - i do not care about punishment.

For egg. in Poland exist tax rule that Poland can not tax actions that can not be valid legal transactions. I would like to know how it is in other countries.

post #4 of 16

In the USA, you are required to declare all income generated from any source, whether legal or illegal, to the IRS. 

 

This is a tactic designed to trap criminals into not paying required taxes, so they can still be imprisoned on tax evasion if there is no full proof of their true crimes. 

post #5 of 16
Thread Starter 

You have smart IRS. Can You point for me specific law rule (§, act etc)?
What is the basis for the existence of this principle?
 

post #6 of 16
Quote:
Originally Posted by asmagus View Post

You have smart IRS. Can You point for me specific law rule (§, act etc)?

What is the basis for the existence of this principle?

Just historically speaking, this is well known as one of the ways the "system" eventually got Al Capone. I don't know the specific piece of legislation, but I'm sure you could dig up the proceedings of that and see what laws and cases were cited, and then go from there and see what cites that (Wikipedia didn't yield the exact law being cited, it just says "tax evasion" and "Prohibition violations"). It may very well be that those laws came about during the early 20th century to combat organized crime, but I don't know this for certain.

If you're lazy like me, there's probably a documentary/movie version of this that you can find from A&E or some similar history/pop-culture channel and just watch through that. The Kevin Costner movie probably won't do much for you, but it's a fun watch. tongue.gif
Edited by obobskivich - 6/21/12 at 8:14pm
post #7 of 16
Quote:
Originally Posted by El_Doug View Post

In the USA, you are required to declare all income generated from any source, whether legal or illegal, to the IRS. 

 

This is a tactic designed to trap criminals into not paying required taxes, so they can still be imprisoned on tax evasion if there is no full proof of their true crimes. 


I would just like to point out that people profiting from illegal activity's, well if they have a brain don't report income from said activity's. And since dealings are most likely in cash who's going to know?

post #8 of 16

There is no particular codification for including illegal income.  Rather, the US Tax Code states that ALL income counts as gross income, except for those specifically mentioned as exempt - and illegal gains are not recognized as exempt.  The specifics of whether or not illegal income must be declared as part of gross income was decided in the courts 366 U.S. 213

 

http://supreme.justia.com/cases/federal/us/366/213/

 

Quote:
Originally Posted by asmagus View Post

You have smart IRS. Can You point for me specific law rule (§, act etc)?
What is the basis for the existence of this principle?
 


Edited by El_Doug - 6/22/12 at 4:05pm
post #9 of 16
Thread Starter 
Quote:
Originally Posted by El_Doug View Post

There is no particular codification for including illegal income.  Rather, the US Tax Code states that ALL income counts as gross income, except for those specifically mentioned as exempt - and illegal gains are not recognized as exempt.  The specifics of whether or not illegal income must be declared as part of gross income was decided in the courts 366 U.S. 213

 

http://supreme.justia.com/cases/federal/us/366/213/

 

 



El_Doug. Thank You! This is what I was looking for.

 

Maybe someone knows how it is in other countries?

post #10 of 16
Thread Starter 

Bump

 

 

Someone from japan - please help!

post #11 of 16
post #12 of 16
Quote:
Originally Posted by WhiteCrow View Post


I would just like to point out that people profiting from illegal activity's, well if they have a brain don't report income from said activity's. And since dealings are most likely in cash who's going to know?

That depends on how you utilize the "cash".  Department of the Treasury (IRS) has the ability to net worth anyone suspected of failing to report income.  If you live in a nice home, drive a Bentley, and your federal income tax returns are either nonexistant, or report income too low to support your life style, beware.  Then come the fraud charges (failure to report income), followed by jail sentences.

post #13 of 16
Thread Starter 
Quote:
Originally Posted by nikp View Post

Mate, you'll find this useful.

 

http://law.ato.gov.au/atolaw/view.htm?docid=TXR/TR9325/NAT/ATO/00001

 

Thank You friend!

post #14 of 16
Thread Starter 

Maybe someone has some new information?
 

post #15 of 16
Thread Starter 

Mayby You have some new information about Taxation of illegal/immoral/invalid activities?

I have found Polok v. C.E.C. [2002] E.W.H.C, 156; [2002] S.T.C. 361 (GB).

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