As an economics nerd, the first thing I wanted to try in Democracy was cutting and simplyifying various taxes to create a very simple system, but I don’t THINK there’s actually a cumulative negative modifier that means that in general, more tax tax complexity has increasing downsides as it grows, is there?
For example, a very simple society governed by let’s say, sales tax, income tax and corporation tax is going to have benefits to GDP, productivity and more from the fact that you don’t need to worry about lawyers and accounts to manage your tax affairs when selling a home, dying, or making investments or selling assets. There would probably be a benefit to equality too, with more complex tax systems favouring the rich, who can pay for the lawyers to guide them to legally avoid the rules.
As it stands, the incentive is to implement a “whack a mole” tactic of various taxes on stuff you don’t want like legal drugs, cars, petrol, frequent flyers etc, which is certainly accurate, but lacks an accounting for the downsides of this that typically go ignored by politicians.
In reality, the tendency to greater complexity in the system is going to be a negative for both the taxpayer, and the state, as they have to enforce and manage the ever-increasing number of taxes.