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Did the Tax Reform Act of 1986 Simplify Tax Matters?


  • Joel Slemrod


This paper attempts to assess whether the Tax Reform Act of 1986 simplified tax matters significantly, or at all. I conclude that, despite a few scattered signs that tax-related financial planning has declined, the compliance cost of the income tax system is probably higher now than it was in the early 1980s. This suggests that the Tax Reform Act achieved little, if any, simplification in the tax system, although it remains possible that the Act dampened what would have been an even greater increase in compliance cost.

Suggested Citation

  • Joel Slemrod, 1992. "Did the Tax Reform Act of 1986 Simplify Tax Matters?," Journal of Economic Perspectives, American Economic Association, vol. 6(1), pages 45-57, Winter.
  • Handle: RePEc:aea:jecper:v:6:y:1992:i:1:p:45-57 Note: DOI: 10.1257/jep.6.1.45

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    References listed on IDEAS

    1. Hausman, Jerry A & Poterba, James M, 1987. "Household Behavior and the Tax Reform Act of 1986," Journal of Economic Perspectives, American Economic Association, vol. 1(1), pages 101-119, Summer.
    2. Slemrod, Joel, 1990. "Optimal Taxation and Optimal Tax Systems," Journal of Economic Perspectives, American Economic Association, vol. 4(1), pages 157-178, Winter.
    3. Pechman, Joseph A, 1987. "Tax Reform: Theory and Practice," Journal of Economic Perspectives, American Economic Association, vol. 1(1), pages 11-28, Summer.
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    Cited by:

    1. Richard J. Cebula, 2013. "New and Current Evidence on Determinants of Aggregate Federal Personal Income Tax Evasion in the United States," American Journal of Economics and Sociology, Wiley Blackwell, vol. 72(3), pages 701-731, July.
    2. Richard J. Cebula, 2014. "The underground economy in the U.S.A.: preliminary new evidence on the impact of income tax rates (and other factors) on aggregate tax evasion 1975-2008," PSL Quarterly Review, Economia civile, vol. 67(271), pages 451-481.
    3. Cebula, Richard J., 2011. "Aggregate Income Tax Evasion: Empirical Results Using new IRS Data for the U.S. - L’evasione aggregata del reddito: risultati empirici ottenuti utilizzando i nuovi dati IRS per gli USA," Economia Internazionale / International Economics, Camera di Commercio Industria Artigianato Agricoltura di Genova, vol. 64(4), pages 423-443.
    4. Peichl, Andreas & Fuest, Clemens & Schaefer, Thilo, 2006. "Does tax simplification yield more equity and efficiency? An empirical analysis for Germany," FiFo Discussion Papers - Finanzwissenschaftliche Diskussionsbeiträge 06-5, University of Cologne, FiFo Institute for Public Economics.
    5. Cebula, Richard & Foley, Maggie, 2010. "Personal Income Tax Evasion Determinants Revisited: An Exploratory Study Using Newly Available Data," MPRA Paper 52028, University Library of Munich, Germany.
    6. Murphy, Kristina, 2004. "Aggressive tax planning: Differentiating those playing the game from those who don't," Journal of Economic Psychology, Elsevier, vol. 25(3), pages 307-329, June.
    7. Cuccia, Andrew D. & Carnes, Gregory A., 2001. "A closer look at the relation between tax complexity and tax equity perceptions," Journal of Economic Psychology, Elsevier, vol. 22(2), pages 113-140, April.
    8. Cebula, Richard J. & Coombs, Christopher & Yang, Bill Z., 2009. "The Tax Reform Act of 1986: An Assessment in Terms of Tax Compliance Behavior," Economia Internazionale / International Economics, Camera di Commercio Industria Artigianato Agricoltura di Genova, vol. 62(2), pages 145-162.
    9. Peter, Klara Sabirianova & Buttrick, Steve & Duncan, Denvil, 2010. "Global Reform of Personal Income Taxation, 1981–2005: Evidence From 189 Countries," National Tax Journal, National Tax Association, vol. 63(3), pages 447-478, September.

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    JEL classification:

    • H20 - Public Economics - - Taxation, Subsidies, and Revenue - - - General


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