THE PROBLEM WITH CORPORATE TAX CODES.

The administration's proposals to close some corporate tax loopholes didn't get much attention last week. In part, that's because the actual issues being addressed are extremely complicated. But that doesn't mean they're not important. This sort of thing, for instance, is really galling, and insofar as we need to raise $60 billion from somewhere, stopping corporations from playing a game of international tax arbitrage is probably a good idea.

But "this sort of thing" is endemic to a complicated tax code. The more intricate the statutes, the easier it will be for trained lawyers to find loopholes. But if the loopholes are very complicated, then the only people who know enough to argue over them will be the lobbyists dedicated to their preservation. It's hard to build a movement around the fact that a rule designed to simplify the classification of different kinds of subsidiaries has been misused by multinational companies who set up subsidiaries and then use high-interest loans to shield profits from taxation. I mean, you probably didn't even make it all the way through that sentence. A simpler tax coe isn't only important because it's more efficient. It's also important because it's more governable.

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