Sometimes an example as follows is sufficiently illustrative:
Article 63 of the Personal Income Tax Law: Regular taxable income.
"The result of the operations provided for in Article 61, added to the positive balance, if any, dispose of the provided in paragraph one from the previous article, and the ratio of the second paragraph of the following Article and minus the amount of irregular negative returns referring to letter b) of section two of Article 59, shall constitute the amount of the regular income of the taxpayer.
The amount of regular income established in the preceding paragraph shall constitute the regular part of the tax base"
There is similarly complexity in Article 37.2.c), second paragraph of the same Act, which referring to the mixed income from capital, provides:
"For the purposes of the provisions of this letter and for emissions of financial assets with variable or floating performance, cash interest shall be taken as the internal rate of return, considering only yields of an explicit nature and calculated, with reference to the initial assessment of the parameter for which the final amount of the accrued interest is periodically set ".
The above are just two examples, nothing outside of the reality for many tax payers, illustrating the complexity of tax rules.
There are many more. This complexity, aggravated by the flood of amendments and derogations tacit to specific provisions, puts the taxpayer facing a bleak picture.
Nothing could object if the Administration who, in view of the facts declared by taxpayers calculates the payable tax, could appeal in case of a mistake. However, in practice, the situation is reversed. The taxpayer must interpret the rules, clearing complex prints, perform arithmetic calculations and reach the "magic" number to enter or, in most cases, to return. And, of course, mistakes are paid, sometimes with severe penalties (see section 3.9.).
In our view, there are three possible solutions to the problem:
a) The current tax system is simplified. The complexity of the matter prevents a drastic simplification of legislation.
b) The Administration is in charge of settling taxes, as happens in most taxes at a local level, and, at the option of the taxpayer, the inheritance tax. This solution, in reasonable principle, also seems unfeasible, because of the enormous staffing qualified that such a measure requires.
c) Limit the penalties in which the Administration test, effectively and without assumptions, defrauding the mood of the taxpayer. This is, in our view, the most effective solution to the problem debated.