Rising Income Tax Complexity

This paper 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 prepopulated tax returns. Second, we use word counts of the tax codes in several countries dating as far back as the early 1980s as a proxy for tax-compliance costs. This measure shows that compliance costs have been steadily increasing.