At the request of National Taxpayer Advocate W. Val Oveson, the AICPA tax executive committee recently provided a list of the 24 most serious problems encountered by U.S. taxpayers.
Complexity of the current tax law topped the list. We dont need a new tax code, said David A. Lifson, chairman of the tax executive committee. We need a tax code that is simpler.
Reiterating a position that the AICPA tax division has held since the late 1980s, the executive committee called for simplification of the code, saying that its complexity is the source of often overwhelming confusion and frustration for taxpayers. Simplification of the tax law should be everyones responsibility: lawmakers, regulation writers, judges and administrators.
From a policy standpoint, however, the link between equity and complexity in the tax code makes simplification difficult.
Simplicity and fairness are tradeoffs, explained William Stromsem, a director in the AICPA tax division. The fairer you make the tax code the more complex it becomes. The simpler you make the tax code the rougher the justice.
Lifson also offered an explanation of the dilemma: There is an eternal triangle in Congress consisting of the conflicting goals of fairness, simplification and economic policy, which all get in the way of one another.
There are hundreds of rules dispersed throughout the code that attempt to give tax benefits to particular groups, he said. The more targeting you do the more complex the tax system becomes.