Taxation Problems On Illegal Income

Whether illegal income is taxable is regarded as important all over the world. At present, most countries, such as America, Germany, Japanese, Canada and Italy, levy a tax on illegal income. However, there are still some countries such as England excluding illegal income from taxable gains.In our country, although we are required to pay taxes on the income from some service such as massage or the additional fee of the school from enrolling the children who are out of its area, there is no definite legal rule on the taxation problem of illegal income. Thus the topic whether illegal income should be taxed is hotly debated among the scholars.The thesis concentrates on theoretic analyses and construction of relevant system on taxing illegal income. It is divided into six parts:Part I, Preface of thesis.Part II, Definition of illegal income.Part III, Introduction of foreign countries'attitudes towards taxing illegal income.Part IV, Theoretic analyses for the argument that we should tax illegal income.Part V, Analyzing the problems we will face when taxing illegal income, and offering some suggestions towards the problems.Part VI, Construction of relevant Systems for taxing illegal income. It contains two aspects. One is whether the expenses for illegal income can be deducted. The other one is how to deal with the tax when illegal income is forfeited or returned to the third party.Through analyses, we come to the conclusion as follows:Illegal income is the income getting from the illegal conducts which are not in accordance with the laws, administrative regulations and so on. As long as the source of the income is illegal, whether it has been recognized and dealt with, it does belong to illegal income. Because of its theoretic bases and realistic significance, levying a tax on illegal income is feasible. Undoubtedly, we will be confronted with many difficulties if we decide to tax illegal income. However, taking measures such as construction of regulations on how to file a tax return can resolve the problems. And relevant systems for taxing illegal income are constructed in the last part.In order to accomplish the thesis better, plenty of domestic and foreign materials are collected. There are two positive contributions in it:First of all, the thesis not only analyzes the theoretical bases of taxing illegal income, but also explores the problems we will face if illegal income is taxed, and constructs the relevant systems.Secondly, the thesis contains much information from America. It can offer other scholars abundant materials to further the study in this area.