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Tax Fraud is a criminal activity done by a manager of a firm or at least one tax payer who intentionally manipulates tax data to deprive the tax authorities or the government of money for his own benefit. Tax fraud is a kind of data fraud, and happens every time and every where in daily life of households, business, economics, politics, science, health care or even in religious communities etc. Data fraud is extensionally characterized by the four fields: Spy-out, data plagiarism, manipulation and fabrication. Data manipulation takes existing data and manipulates the content encapsulated in tables, diagrams, documents or (historical) pictures.
Tax fraud manipulates book keeping figures and tax declarations either by increasing expenditures or decreasing income. There is no clear boundary to accounting and balance sheet policy of firms, especially if accounting and valuation latitude is utilized.
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