[matwood]

> one would have to be rather daft to assume that a country with such absurdly high taxation did not have tax evasion as a key pastime - although probably not as aggressively as in places like the US

I think there is a distinction between avoidance (typically considered legal) and evasion (fraud and illegal). Everyone should practice avoidance, using the system as designed. IME, evasion is much higher in countries with say a VAT than the US. Paying cash for transactions, even rather large ones, is common in order to avoid 10-20%+ VAT.

[jltsiren]

There is a third category: tax avoidance by abusing loopholes in the system. While legal, it's not about using the system as designed. I find it morally equivalent to illegal tax evasion. Behavior like that erodes trust in the system and makes the society worse.

[milesrout]

There are three categories: tax minimisation (structuring legitimately to minimise tax), tax avoidance (structuring legitimately but artificially to avoid taxes) and tax evasion (lying to evade tax).

Tax minimisation is fine. Tax avoidance is, in sensible countries, not illegal but ineffective: tax avoidance arrangements are void for tax purposes. Tax evasion is a serious crime.

Avoidance is not using the system as it was designed. It is using the system as it was not intended, creating totally artificial structures just for tax reasons. In a sensible society the taxman can just say "clearly artificial so I will ignore this" and if you disagree, well, see you in court.

[rambambram]

Money that is not required to be paid cannot be called a tax. Taxes are not voluntary. Things like tax avoidance don't even exist, by definition of the word.

[jsutter909]

What would you call going out of your way to buy cigarettes in a lower tax jurisdiction? The word avoidance seems pretty fitting here. Taxes are as voluntary as the activity being taxed

[milesrout]

Presumanly is tax evasion if you buy them elsewhere then import them into your country without paying the required import duties.

[amadeuspagel]

How about vacationing in a country that has a lower VAT because hotels and everything are cheaper?

[milesrout]

VAT is a consumption tax. If you consume goods in a place with lower consumption taxes then the tax is doing exactly what it is meant to do.

If you buy consumer goods in a low-VAT place but transport them to a high-VAT place and consume them, then that is clearly illegitimate for the same reason that it is legitimate for VAT to be applied to imports and refunded to exporters.

[arghwhat]

Within EU, you have free movement of goods, and the VAT is generally paid in the country of sale, not in the country of of the consumer. There are a few exceptions to this, and other regions might have other trade agreements.

Within the EU definition, VAT taxes the company making the sale for the increase in value of a product through the processes the companies and distributors applied to it, and is not a taxation of the receipt of said value.

There is nothing illegitimate about then consuming the product in a different country. It just doesn't happen to send money to your own country's treasury.

[rambambram]

I would call that an economic decision, or an opportunistic one. How can you avoid something that's not even there?