Although there are clear problems with the tax code, people forget that some of the complexity is there because that's what most people actually want.
People want a tax deduction for charity.
People want to tax corporate profits, not revenues - so you need to figure out how much is actually profit. Is R&D a real expense? Can we just sink all our profits into R&D and say we have no profits? But you can't just tax all R&D as if it was profit that the company is hiding or software companies would go out of business. What about when you have some complicated schedule of when a client pays you - do you record the revenue when you earn the money or when you get it?
Many people want a tax deduction for a mortgage (whether or not this makes any sense).
Like software, complexity gives room for hacks. You can't hack into a hammer, but you can hack into a computer. If you want a complex tax code, you don't simply declare "Simplify!" It's like "I'm going back to my typewriter to avoid viruses." There are more realistic ways to deal with the problem, and like computer security, it takes real time and effort.
People want a tax deduction for charity.
People want to tax corporate profits, not revenues - so you need to figure out how much is actually profit. Is R&D a real expense? Can we just sink all our profits into R&D and say we have no profits? But you can't just tax all R&D as if it was profit that the company is hiding or software companies would go out of business. What about when you have some complicated schedule of when a client pays you - do you record the revenue when you earn the money or when you get it?
Many people want a tax deduction for a mortgage (whether or not this makes any sense).
Like software, complexity gives room for hacks. You can't hack into a hammer, but you can hack into a computer. If you want a complex tax code, you don't simply declare "Simplify!" It's like "I'm going back to my typewriter to avoid viruses." There are more realistic ways to deal with the problem, and like computer security, it takes real time and effort.