Geithner and Our Incomprehensible Tax System

That we find so little support for tax simplification is a testament to how much politicians of both parties, and perhaps ordinary citizens, have come to see the IRS code not merely as a means for raising government revenues, but as a tool of social policy. Pick a cause on the Left, Right or in the Center—from encouraging home ownership to supporting working families to subsidizing higher education to incentivizing investment in environmentally-friendly energy—and we use the tax code to support it through deductions and credits. Many of those causes are no doubt worthy—who can argue about helping spur home ownership?—but once you make the tax code your agent of change you are on a slippery slope. The more deductions, credits, rates and alternate taxes we fold into our system in search of perfect equity and the promoting of worthy causes, the more likely we make it that ordinary Americans who get audited will get hit with big bills for back taxes.

A number of Geithner’s supporters have argued that it would be a shame to kill the nomination of someone so well qualified to run Treasury because of simple tax oversights. But as long as we keep passing off the tax blunders of sophisticated, well qualified individuals, we condemn the rest of Americans to an increasingly frustrating and counterproductive wrestling match with our unwieldy tax code.

Maybe, if Geithner is confirmed, this experience will make him the advocate for tax simplification that we need.

Source (Real Clear Markets by Steven Malanga)