ABSTRACT
Up until the late 1970s, academics and public officials paid very little scholarly attention to the size of illicit economic behaviour that may be taking place. Gutmann (1977) provided the first published estimate of the size of the underground economy in the United States and his work subsequently generated considerable interest.1 Much of this interest focused on the size of subterranean activities in several countries other than for Australia. CBA (1980) and Carter (1984) have discussed illicit economic behaviour in Australia however neither of these studies has provided a time series estimate of its size that could be used to gauge the extent of tax evasion taking place in Australia.2 Many of the consequences that we will allude to in this and in Chapter Six have ignited fresh concerns about how to deal with the underground economy. In fact governments around the world are beginning to increase the amount of financial resources they have previously devoted to tackling the underground economy.
