Rising Income Tax Complexity

Published in National Tax Journal, Vol 77. No. 1, (2024)

This research provides novel estimates on the cost of filing taxes over time and in different countries. First, we ran a survey of US taxpayers. We find that taxpayers perceive that tax complexity and filing costs have been increasing and that the majority would be willing to pay for simplifying the tax system and adopting pre-populated tax returns. Second, we use word counts of the tax codes in several countries dating as far back as the early 1980’s as a proxy for tax compliance costs. This measure shows that compliance costs have been steadily increasing.