A flat tax is not more "efficient" than a tax system with loopholes

Source: Ludwig von Mises Institute
by Per Bylund

"A frequently repeated claim is that loopholes in the tax code are 'inefficient.' A more efficient tax, economists say, is a flat and all-encompassing tax that is inescapable. Why? Because this means no one will waste resources on tax planning and thus tax avoidance. In other words, more resources will be used in production, which is better for the 'economy.' Leaving the moral and ethical argument about tax avoidance aside, the efficiency argument too is completely wrong. It shows how much economists have deviated from understanding what they supposedly try to learn about: the market." (08/10/17)