NCPA - National Center for Policy Analysis

U.S. Tax Code Has, Once Again, Grown into a Patchwork Quilt

February 4, 2003

Seventeen years after the tax code was overhauled under President Reagan and made somewhat more comprehensible, it has evolved into an even bigger jumble as successive congresses and administrations have piled on layers of complex changes. The tax-preparation industry has grown in lock-step with each new provision, as bewildered taxpayers where thrown into their arms.

  • This year's instruction manual for calculating individual taxes adds up to 126 pages -- a far cry from the 56 pages needed in 1987, when the Reagan revisions took effect.
  • As the tax code became a vehicle for promoting social goals in the 1990s, so did it lose coherence, critics note.
  • Pamela F. Olson, assistant secretary of the Treasury for tax policy, points out that overlapping or inconsistent provisions of the code have made errors in calculations more likely -- adding to higher costs for taxpayers and the Internal Revenue Service alike.
  • Experts say that several areas greatly in need of attention and reform are the alternative minimum tax and the estate tax.

The alternative minimum needs attention because it is about to swamp millions of middle-income families. The estate tax is a threat because reforms suddenly expire after 2010 -- creating the morbid incentive to die before the expiration for the sake of one's beneficiaries.

Source: Daniel Altman, "A Tax Code Not Intended for Amateurs," New York Times, February 4, 2003.

 

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