[Foundation-l] [ANNOUNCEMENT] Greenspan illustration project

Sat Nov 3 22:07:55 UTC 2007

> Maybe. But then the effect of that trivial payment would still need to
> be proportional to the initial reasons for the audit.  For the person
> who is intent on evading tax there is a matter of cost/benefit
> analysis.  Assume a $100 per year payment, a 50% tax rate, a 100%
> evasion penalty and a 10% audit probability.  Over 10 years the person
> will earn $1,000.  If he regularly reports this he will pay $500 in
> taxes.  If it is only caught in an audit it will cost $50 tax plus $50
> penalty or $100.

Audits look at more than just the last year (last 10 years in the UK, I think).