Complexity Continues to Burden Tax Code

December 20, 2006

This morning, President Bush signed the Tax Relief and Health Care Act which extends several tax credits that were due to expire at the end of the year. As we have argued in a number of ways, tax credits make the tax code more complex, foster a perception of unfairness and cause tax rates to be twice as high as they need to be in order to raise the same amount of revenue.

Today on CNBC’s “Morning Call”, Tax Foundation President Scott Hodge said, “This is why Americans feel the tax code is far too complicated and such the mess that it is today.”

“We are turning the IRS into an extension of the social welfare state and handing out goodies like an ATM machine to anyone who comes to the door”, he said. Budget-hawk lawmakers who have sought to purge senseless and wasteful pork from appropriations bills should also view tax breaks for special interests through the tax code in the same way.

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