A Reflection on Criminal Enforcement Mechanisms for Tax Crimes in Iran

Abstract

Tax crimes, as one of the most significant categories of economic offenses, constitute a serious threat to tax justice, economic transparency, and public trust. In the 2015 amendment to the Direct Taxation Act of Iran, the legislator, through the enactment of Articles 274 to 277, sought to adopt a deterrent policy by criminalizing acts such as the preparation of false documents, the use of others’ commercial cards, and the failure to submit tax returns, as well as by prescribing punishments including imprisonment, monetary fines, and social deprivations. Data were collected using a library-based method and analyzed through a descriptive–analytical approach. The central question of this research is whether these punishments have been able to achieve the necessary deterrent effect in practice. The findings indicate that although the legislator has underscored the importance of combating tax evasion by emphasizing criminal enforcement mechanisms, challenges such as weaknesses in the detection and proof of offenses, extensive reliance on mitigating and leniency institutions, the lack of proportionality between certain punishments and the nature of the violations, and the absence of effective supervision have reduced the efficiency of these enforcement mechanisms. Non-criminal enforcement measures, such as financial penalties under Article 275, have also demonstrated limited effectiveness due to institutional and executive gaps. The results of the study suggest that exclusive reliance on severe criminal sanctions cannot prevent the growth of tax crimes. The experience of other countries shows that combining criminal instruments with preventive measures, smart supervision, and the strengthening of tax culture is more effective. Accordingly, revising Iran’s criminal policy with the aim of ensuring proportionality of sanctions, enhancing the efficiency of supervisory institutions, and promoting voluntary compliance is an unavoidable necessity for achieving tax justice and sustainable development.