Tax Law
| DOI | 10.1177/0964663915575969 |
| Author | John Snape |
| Date | 01 June 2015 |
| Published date | 01 June 2015 |
| Subject Matter | Introduction |
Introduction
Social & Legal Studies
2015, Vol. 24(2) 155–163
Tax Law: Complexity,
ª The Author(s) 2015
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DOI: 10.1177/0964663915575969
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John Snape
University of Warwick, UK
Abstract
This essay introduces the various contributions to a special issue of the journal. Its
overall theme is the variety of ways in which ‘‘tax complexity’’ performs political func-
tions. The essay establishes the principal meaning of tax complexity as ‘‘rule complexity’’
and places each contribution within the controversies on the subject. Highly abstract and
technical tax law is seen as foundational to the neoliberal regulatory state. Tax law has a
complexity exacerbated by the incorporation of other regulatory systems, by arguments
over linguistic indeterminacy and by a disconnection between wider political debate and
those closely involved in developing and drafting tax legislation. An analysis of the
relationship between the political ordering of the regulatory state and the phenomenon
of tax complexity is followed by a discussion of political debate and the significance of
legal formalism. The essay concludes by speculating on the custodianship of definitive
interpretation in the tax law context.
That taxation laws are complex is a truism. Speaking of income tax statutes, Judge
Learned Hand recalled an aphorism of his teacher, the philosopher William James, about
certain passages of Hegel. These ‘monsters’, like some of Hegel’s writings, though ‘writ-
ten with a passion of rationality’, might nonetheless lack ‘any significance save that the
words are strung together with syntactical correctness’ (Hand, 1947: 169). Everywhere,
bewildered lawyers nod their assent, tax specialists along with the rest.
Complexity so conceived is known as ‘rule complexity’, that is, ‘the difficulty in
understanding and interpreting legislative and regulatory rules’ (Schenk, 2011: 261;
Mumford, 2015). You want to know, for instance, whether a particular item of expendi-
ture is deductible in calculating a certain category of taxable income. Every specialist
you ask tells you something slightly different (Picciotto, 2007: 27). Some of them, of
Corresponding author:
John Snape, University of Warwick, Coventry CV4 7AL, UK.
Email: j.snape@warwick.ac.uk
156
Social & Legal Studies 24(2)
course, may be flat wrong. Even among those who are not, though, there are still subtly
divergent answers and explanations. That, in essence, is rule complexity. To be sure, tax
complexity assumes other shapes as well. People sorting through heaps of invoices and
receipts, when completing their tax returns, experience ‘compliance complexity’, while
those who change their everyday behaviour simply to reduce their tax liabilities are mea-
suring the cost of ‘transactional complexity’ (Schenk, 2011: 261).
The focus in the present collection is on rule complexity, that is, the indeterminacy of
legal language amid shifting political and social contexts. The other kinds are discussed
too, as well as overlapping ideas often confused with them, such as ‘transparency’ and
‘salience’ (Schenk, 2011: 261; Mumford, 2015; Gribnau, 2015). However, unless other-
wise stated, it is rule complexity that is mainly in view. The various contributions con-
tend for different aspects of the proposition that complexity has an enduring and
multifaceted political significance.
Complexity as indeterminate and arcane
Tax complexity has attained peculiar characteristics in the ‘regulatory state’ that has
grown out of the ‘Washington consensus’ of the 1980s (Moran, 2007; Steger and Roy,
2010: 19). Characteristic of the regulatory state, for sure, is the privatization of public
services. Equally emblematic, though, is the ever tighter tying in of private sector forms
of regulation to legislative endeavour (Picciotto, 2011: 9). Tax is no exception. Indeed,
the fiscal creations of the neo-liberal settlement have proved surprisingly resilient to both
the financial crisis of 2007–2009 and the ongoing vicissitudes of public finance (Crouch,
2011; Prabhakar, 2015). Not only has complexity become definitional, its characteristics
have metamorphosised. The significance of those characteristics, moreover, has shifted.
Complexity might, indeed, almost be the defining characteristic of taxation in our
‘neo-liberal’ state (Adam et al., 2011: 480–494; Dodwell, 2013: 31; Houlder, 2008).
So it is easy to forget that the kind of complexity it has tended to engender has not always
been so prominent. An important element of neo-liberalism is the enlisting of govern-
ment resources in the uncritical promotion of the ends of business. Complexity has gar-
nered attention as the tax base has been built increasingly on measures of income, rather
than on products, and as those measures of income have themselves become increasingly
abstract. Tax law rules that were complicated because archaic, bureaucratic and remote
were features, successively, both of the administrative state of industrial modernity and
of the ‘embedded liberalism’, or ‘social liberalism’, that the post-war consensus grafted
onto it (Briggenshaw v. Crabb, 1948; Great Western Rly Co Ltd v. Bater, 1920; Kunzlik,
2013: 286–287; Meade, 1978: 18–21; Monroe, 1981: 24; Re Kilpatrick’s Policies
Trusts, 1966). Of course, they were. Learned Hand indeed suggested as much. He was
accustomed to picking his way, often unsympathetically, through the intricacies of
Roosevelt’s New Deal legislation (Gunther, 2010: 467). But the specialized complex-
ity of elite professional disciplines was not then characteristic of the tax system in the
way that our times have seen it become. A century ago, the system was characterized
by some progressivity in return for the reduction of customs duties (Hepker, 1975: 20;
Trentmann, 2008: 319, 353; Wicks, 2006: 84–89). Two...
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