Abstract In a federal system of government many jurisdictions must compete for use of finite tax sources. Such a circumstance has led to overlapping in the use of tax bases. The growing state reliance on personal income taxes, together with the intensive use by the Federal Government of the same tax base, is an example. 2 Such multiple use of income as a tax base has created duplication in both taxpayer compliance costs and tax agency administration costs. For the Federal Government, piggybacking would have the attractive characteristic of providing greater assurance that state tax systems would be structured in a manner consistent with national tax policy. The issue of tax simplification illustrates the value of such an integrated tax system. Federal efforts to simplify the income tax system have taken such forms as increasing the amount of the standard deduction and simplifying the method by which it is computed. Such advances in simplifying the task of Federal tax compliance are often offset, however, by state tax laws which are not amended in a similar manner.
Strefeler et al. (1980) studied this question.