Corruption undermines tax revenue, reduces compliance and distorts the fiscal space. Thus, controlling corruption is key to enhancing tax efficiency and government effectiveness globally. Addressing corruption in tax systems has a dual benefit: it not only strengthens revenue generation by curbing economic crimes, such as tax evasion, but also ensures that public funds are directed towards their intended purposes, such as social and infrastructure development. Corruption in tax expenditure distorts government resource allocation, prioritizing projects that offer opportunities for kickbacks, such as large investment initiatives or defence spending, over essential sectors like education and healthcare. Especially in emerging economies, where tax revenue is relatively low, boosting tax efficiency is crucial to be able to meet the Sustainable Development Goals (SDGs).
Corruption can, for example, affect all processes conducted by a state’s tax administration, from taxpayer registration to the prosecution of tax offences. It can be collusive, where officials and taxpayers strike deals to underpay taxes, or abusive, where officials extort bribes from honest taxpayers.
The complexity of tax systems may create challenges for combating corruption linked to tax, which in turn may open opportunities for exploitation. The resulting loss of public funds reduces the state's capacity to invest in critical areas and perpetuates a cycle of weak governance and underdevelopment. Implementing robust anti-corruption measures linked to tax reduces the diversion of resources, thereby ensuring the integrity of tax systems. In turn, this increases public trust, enhances tax compliance and ensures continuous financing for development.
Implementing strong anti-corruption measures is essential to ensuring that efforts to enhance tax collection and optimize tax expenditure are effective and transparent. Closer and more timely inter-institutional collaboration between anti-corruption and tax authorities can also boost efforts to combat, prevent and recover the proceeds of corruption and tax crimes.
UNODC | 2025
Corrupt actors may exploit tax systems for personal gain through bribery, abuse of functions, trading in influence, favoritism, or manipulating assessments and audits. On the other hand, voluntary compliance increases when tax systems are perceived as fair, simple, and transparent. Ultimately, tax systems that are clearly regulated, evenly enforced, accountable and transparent reduce opportunities for corruption and build public trust.
Seoul, Korea | 19-20 June 2025
UNODC and the Stolen Asset Recovery (StAR) Initiative, with the support of the Ministry of Foreign Affairs of Denmark, is facilitating three Corruption and Tax Regional Meetings around the world to strengthen inter-institutional collaboration. The second of these meetings was held for countries in Asia, in partnership with the Supreme Prosecutor’s Office (SPO) of the Republic of Korea.
Nairobi, Kenya | 20-21 November 2024
On 20-21 November 2024, a group from both Tax and Anti-Corruption Authorities in Sub-Saharan Africa gathered for the first Regional Meeting in the series, organized through the UNODC Anti-Corruption Hub for Africa, to identify and discuss possibilities for cooperation between authorities nationally and internationally in the region.
Stolen Asset Recovery (StAR) Initiative (The World Bank - UNODC), 2022
This publication focuses on the benefits of interagency cooperation between tax authorities and law enforcement agencies working on preventing, detecting and recovering the illicit financial flows derived from tax evasion, corruption and money-laundering.
