Tax Fraud Detection using Graph based Approach

A tax is the source of government funding. The purpose of tax is to increase revenue to fund government. The money paid by taxpayers in taxes goes to many places. It is used to paying the salaries of government workers, tax money also help to support common resources, such as police and firefighters. Tax money helps to ensure the roads you travel on are safe and well-maintained. Taxes fund public libraries and parks. Tax evasion is increased so tax evasion detection is very important in current status to avoid loss of government funding. Taxpayers are required to store and update, on an annual basis, a set of documents and information relating to international transactions or specified domestic transactions. In recent work on tax evasion detection is done but it is not effective some drawbacks are there. This article gives an introduction to related work done in tax evasion detection and describes the methods of tax evasion. Auditing is very important to find out tax evasion, and data mining techniques are applied to select record for audit, also data mining techniques are applied in tax evasion detection.