Policymakers Should Learn from Tax Complexity in Brazil and the United States

As we approach the end of tax filing season, Americans are facing the complexity the tax code imposes on them and their businesses. In 2017, the Office of Information and Regulatory Affairs (OIRA) estimated that Americans spend collectively over 8.1 billion hours to comply with tax requirements. The challenges imposed on taxpayers in America and abroad by tax complexity show that simplifying the tax code is a worthy goal for policymakers, as the costs of tax complexity keep entrepreneurs and businesses from investing and contributing to economic growth.

Comparisons of tax codes internationally reveal a large variation in......

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Why Tax Complexity Still Matters

Many Americans will be filing their tax returns next week. As Americans work on this, it’s worthwhile for us to consider why tax complexity still matters. There was a kerfuffle last month over this subject; Senator Ted Cruz, who advocates a simpler tax system, pointed out that the tax code has more words than the Bible (which is true), and the Washington Post’s fact checker column took the opportunity to editorialize on the subject, asking “does any of this matter?”

The Fact Checker column was mocked on some conservative blogs for acknowledging a true fact, stepping into an editorial role, deciding that the fact didn’t matter, and declaring it a nonsense fact, worthy of neither a Geppetto Checkmark nor a Pinocchio. Since this kerfuffle, Senator Cruz has at times fired back at fact checkers he deems untrustworthy.

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The Cost of Tax Compliance

Over the years, the tax code has been altered by changes to statutes, regulations and case law, adding up to over 70,000 pages of instruction to filing taxes. It is the IRS’s job to enforce tax policy, so they keep track of the time and cost of filing taxes for individuals and businesses.

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How Many Words are in the Tax Code?

The tax code is huge and complex. But how huge and complex is it?

Andrew Grossman, the legislation counsel for the Joint Committee on Taxation that helps write tax laws, attacked us in Slate yesterday for saying that the tax code runs 70,000 pages, countering that it’s “only” 2,600 pages.

So how long is it really? There are a couple ways to look at it.

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