ABSTRACT
The process of developing sophisticated tax compliance strategies is not a simple or easy one but necessary if tax evasion is to be tackled without excessive economic and political collateral damage. The main themes in developing optimal tax compliance strategies are to take wider considerations into account – such as the purposes of the tax system, individuals' motivations regarding compliance and the different ways in which tax authorities can both encourage compliance and discourage evasion. Tax evasion is the primary concern relating to the underground economy though some strategies designed to reduce tax evasion might also help contain undesirable forms of tax avoidance. Monitoring and evaluating performance, of course, is not always an easy task particularly with regard to activities that are necessarily hidden from official view.
