Number of Words in US Tax Law

Description

Thousdands of words in US tax law for 1995 to 2005 in 10 year intervals. This includes income taxes and all taxes in the code itself (written by congress) and regulations (written by government administrators).

Usage

data(UStaxWords)

Format

A data.frame containing:

year

tax year

IncomeTaxCode

number of words in thousands in the US income tax code

otherTaxCode

number of words in thousands in US tax code other than income tax

EntireTaxCode

number of words in thousands in the US tax code

IncomeTaxRegulations

number of words in thousands in US income tax regulations

otherTaxRegulations

number of words in thousands in US tax regulations other than income tax

IncomeTaxCodeAndRegs

number of words in thousands in both the code and regulations for the US income tax

otherTaxCodeAndRegs

number of wrds in thousands in both code and regulations for US taxes apart from income taxes.

EntireTaxCodeAndRegs

number of words in thousands in US tax code and regulations

Details

Thousands of words in the US tax code and federal tax regulations, 1955-2005. This is based on data from the Tax Foundation (taxfoundation.org), adjusted to eliminate an obvious questionable observation in otherTaxRegulations for 1965. This series was not reported directly by the Tax Foundation but is easily computed as the difference between their Income and Entire tax numbers. This series shows the numbers falling by 48 percent between 1965 and 1975 and by 1.5 percent between 1995 and 2005. These are the only declines seen in these numbers and seem inconsistent with the common concern (expressed e.g., in Moody, Warcholik and Hodge, 2005) about the difficulties of simplifying any governmental program, because vested interest appear to defend almost anything.

The decline of 48 percent seems more curious for two additional reasons: First, it was preceeded by a tripling of otherTaxRegulations between 1955 and 1965. Second, it was NOT accompanied by any comparable behavior of otherTaxCode. Instead, the latter grew each decade by between 17 and 53 percent, similar to but slower than the growth in IncomeTaxCode and IncomeTaxRegulations.

Accordingly, otherTaxRegulations for 1965 is replaced by the average of the numbers for 1955 and 1975, and EntireTaxRegulations for 1965 is comparably adjusted. This replaces (1322, 2960) for those two variables for 1965 with (565, 2203). In addition, otherTaxCodeAndRegs and EntireTaxCodeAndRegulations are also changed from (1626, 3507) to (870, 2751).

Independent of whether this adjustment is correct or not, it's clear that there have been roughly 3 words of regulations for each word in the tax code. Most of these are income tax regulations, which have recently contained 4.5 words for every word in code. The income tax code currently includes roughly 50 percent more words than other tax code.

Author(s)

Spencer Graves

Source

Tax Foundation: Number of Words in Internal Revenue Code and Federal Tax Regulations, 1955-2005

References

J. Scott Moody, Wendy P. Warcholik, and Scott A. Hodge (2005) "The Rising Cost of Complying with the Federal Income Tax", The Tax Foundation Special Report No. 138.

Examples

data(UStaxWords)
plot(EntireTaxCodeAndRegs/1000 ~ year, UStaxWords, type='b',
     ylab='Millions of words in US tax code & regs')

# Write to a file for Wikimedia Commons
svg('UStaxWords.svg')
matplot(UStaxWords$year, UStaxWords[c(2:3, 5:6)]/1000,
      type='b', bty='n', ylab='',
      ylim=c(0, max(UStaxWords$EntireTaxCodeAndRegs)/1000),
      las=1, xlab="", cex.axis=2)
lines(EntireTaxCodeAndRegs/1000~year, UStaxWords, lwd=2)
dev.off()
# lines 1:4 = IncomeTaxCode, otherTaxCode, IncomeTaxRegulations,
# and otherTaxRegulations, respectively

##
## Plotting the original numbers without the adjustment
##
UStax. <- UStaxWords
UStax.[2,c(6:7, 9:10)] <- c(1322, 2960, 1626, 3507)
matplot(UStax.$year, UStax.[c(2:3, 5:6)]/1000,
      type='b', bty='n', ylab='',
      ylim=c(0, max(UStax.$EntireTaxCodeAndRegs)/1000),
      las=1, xlab="", cex.axis=2)
lines(EntireTaxCodeAndRegs/1000~year, UStax., lwd=2)
# Note especially the anomalous behaviour of line 4 =
# otherTaxRegulations.  As noted with "details" above,
# otherTaxRegulations could have tripled between 1955 and 1965,
# then fallen by 48 percent between 1965 and 1975.  However,
# that does not seem credible, especially since there was no
# corresponding behavior in otherTaxCode.