Assessing the consequences of tax evasion as a result of aggressive tax planning schemes

Vladimir A. Molodyh

VAK Russia 5.2.3 UDC 338

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ASSESSING THE CONSEQUENCES OF TAX EVASION AS A RESULT OF AGGRESSIVE TAX PLANNING SCHEMES Assessing the consequences of tax evasion as a result of aggressive tax planning schemes

АА Аа

Published in Economic policy and national security · Issue 2 · Pages 75–87 · Rubric: Countering the Shadow Economy as a Threat to National Security

Received: 02.09.2025 Accepted: 16.09.2025 Published: 21.11.2025 Language of publication: RUS

Authors

Vladimir A. Molodyh

ORCID

Vladimir A. Molodyh

Academic degree: candidate of economic sciences

Science rang: docent

St. Petersburg University of the Ministry of Internal Affairs of Russia phd · Department of Information Security · St Petersburg

ORCID

ABSTRACT

Introduction. The globalisation of economic relations has led to a decline in the importance of tax compliance, resulting in multinational companies actively using aggressive tax planning strategies and tax avoidance to minimise their tax burden as an important element of cost reduction. An aggressive tax planning strategy offers significant advantages in terms of financial performance, such as increased cash flow to support growth and a substantial increase in net income after tax. However, companies that evade taxes incur additional transaction costs, the amount of which depends on a number of company characteristics. The purpose of the study is to identify the factors and characteristics of companies that influence the likelihood of choosing tax avoidance strategies, as well as to assess the positive and negative consequences for taxpayers as a result of their choices. Methods. The article used correlation and regression analysis tools, as well as matching algorithms, namely, nearest neighbor matching, radius matching, and core matching. Data from company surveys conducted by the World Bank were used as an empirical basis. The results of the study showed that the characteristics of the firm, rather than those of its management, are important factors influencing the choice of tax avoidance strategy. The level of education and experience of the manager did not have a significant impact on the firm's compliance with the law. The following characteristics were found to be statistically significant factors reducing the likelihood of choosing a tax avoidance strategy: legal structure, year of establishment, innovative potential, number of employees, asset structure, and performance results.

KEYWORDS

tax evasion, tax planning, company value, financial reporting

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