Tax Code

It truly is too complicated and it does not do a good job of distinguishing between rich and really, stinking, rich.

Even people with similar incomes are often treated unequally by the tax code because of all the special breaks for certain types of activities. The tax difference between a homeowner and renter with similar incomes, for example, could be thousands of dollars because of the special breaks for the former under the income tax.

The underlying cause of the tax-code mess is the political urge to socially engineer society. Many politicians are “class warriors,” who favor penalizing high-income earners with complicated provisions such as the alternative minimum tax and Obama’s new Buffett rule. Class warriors also favor subsidizing low-income tax filers, such as with the earned income tax credit, which is so complicated that it has an error rate of more than 20 percent.