Mafia tax collection reduced evasion better than the state’s own apparatus

Evidence

The Salvos were legally entitled to a commission of up to 10 percent of the taxes they collected, and in exchange they provided an efficient service, not least because of their unusual powers of persuasion. The arrangement represented a most peculiar case of de facto cooperation between the Italian state and the mafia. Interestingly, since tax collection returned to public hands in 1984, tax evasion has increased dramatically (OSPA: 6918; Repubblica, February 10, 1991). — Diego Gambetta, The Sicilian Mafia The Business of…, 415

Categorization

• XREF: Direct evidence for the reader’s Gambetta thesis: private protection outperforming the state’s formal institutions, parallel to Varese on mafia supply. — connects to: Human customs can defeat state tax policy, making high taxes self-defeating — Dieter Plehwe, Quinn Slobodian & Philip Mirowski (eds.), Nine Lives of Neoliberalism, 334
• QUESTION: Why did mafia coercion cut evasion while state enforcement did not? Fear of private violence vs. legal sanctions—worth probing the mechanism.