According to the joint report by the World Bank and PricewaterhouseCoopers (PwC) British companies have to struggle with 8,300 pages of tax law, behind only India, and the rulebook has doubled over the last decade. This is a clear sign of Gordon Brown's preference for complexity.
The Chancellor has a tendency for making even the best and seemingly straightforward ideas so complicated that they end up in a huge mess. Most people who would benfit from these initiatives will be faced with more bureaucracy and complex procedures that many of them will give up fighting the system to gain benefits they are entitled to. The tax credit system cannot go unmentioned in this case.
The morall of tax rules, as the Times reports it, is a huge burden on businesses and it is likely that non-compliance will increase through sheer ignorance. Companies have to direct huge amounts of their resources for being aware of all the details included in the bulky rulebook. These resources could be put to a much better use if the Chancellor would stop increasing the complexity of tax law and would let business to get on with their work.
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Gordon - too clever but not smart enough
Perversely, it is Gordon's intelligence that is the problem. He has the intellectual rigor and honesty to see the weaknesses in his schemes, and therefore to try to iron out the imperfections by ever more complex rules. Unfortunately, he does not have the intellectual insight to see that these attempts always fail and make matters worse, and that the only way to deal with this conundrum is to have simpler systems.
Gordon is the guy trying to straighten a chair by progressively cutting slices off one leg at a time, until there are no legs left at all. He hasn't realised that he shouldn't have tried to even up the legs in the first place.
Gordon may be the perfect embodiment of the mentality described in my favourite Ludwig von Mises quote (from A Critique of Interventionism, published in 1929):
"With a few exceptions contemporary commentators on economic problems
are advocating economic intervention. This unanimity does not
necessarily mean that they approve of interventionistic measures by
government or other coercive powers. Authors of economics books, essays,
articles, and political platforms demand interventionistic measures
before they are taken, but once they have been imposed no one likes
them. Then everyone - usually even the authorities responsible for them
- call them insufficient and unsatisfactory. Generally the demand then
arises for the replacement of unsatisfactory interventions by other,
more suitable measures. And once the new demands have been met, the
same scenario begins all over again. The universal desire for the
interventionist system is matched by the rejection of all concrete
measures of the interventionist policy."
How little times have changed.