New research suggests welfare fraudsters are facing a tougher time than tax evaders, despite tax evasion costing taxpayers three times more.

A study by Victoria University shows tax discrepancies cost the Government $1.24 billion in 2014, while welfare fraud cost the Government $30.6 million.

However, tax evaders are far less likely to be investigated, prosecuted or imprisoned, and far more likely to have debts written off.

Associate Professor Lisa Marriott said judges tend to denounce blue collar criminals for the "seriousness" of their offending and recognise the "good character" of white collar offenders.

"You tend to see a lot more excuses made for white collar crime. You tend to see language which is a lot harsher associated with welfare fraud."

In one case, a judge told a person found guilty of tax fraud relating to $250,000 they had given "selfless service to the law" and recognised that they "[did not] have a malicious bone in [their] body".

In another case, a judge told a person found guilty of welfare fraud relating to $30,501 they had "ripped the system off" and defrauded the whole country.

The study found the cost of debt recovery was $2.86 for every $100 of tax recovered, and $17 for every $100 of welfare payments recovered.

It also found between 800 and 1000 people were prosecuted for welfare fraud every year, while only 60 to 80 people were prosecuted for some form of tax fraud.

Ms Marriott said even tax fraud and welfare fraud cases involving the same amount of money were treated differently under the law.

"People these days generally tend to think tax evasion is a more serious crime because the financial significance to society as a whole is much greater with tax evasion.

"You've got tax evasion of about three times as much, with the likelihood of getting a prison sentence which is about three times less."

Tax evasion: the numbers

- The Government lost about $1,240,000,000 in tax discrepancies in 2014
- About 0.01% of taxpayers are investigated each year
- About 60-80 people are prosecuted for tax evasion each year
- It costs about $2.86 to recover $100 of evaded tax
- Approximately $430 million of tax was written off in 2011/12
- There were 399 cases of tax evasion between 2008/09 to 2013/14
- The average case during this period involved $229,471
- About 18% of cases during this period resulted in imprisonment

Welfare fraud: the numbers

- The Government lost about $30,553,600 in welfare fraud in 2014
- About 5% of beneficiaries are investigated each year
- About 800-1000 people are prosecuted for welfare fraud each year
- It costs about $17 to recover every $100 of fraudulently obtained welfare payments
- Approximately $10 million of welfare payments was written off in 2011/12
- There were 45 cases of tax evasion between 2008/09 to 2013/14
- The average case during this period involved $76,550
- About 67% of cases during this period resulted in imprisonment

Source: Lisa Marriott, Victoria University School of Accounting and Commercial Law