American tax system is one of the most complexes in the world, it has many codes and it’s difficult for an ordinary citizen without formal training to understand. Due to its complexity and impact it has on business, economy and politics it has always attracted a lot of attention. There is a continuing discussion that takes place among politicians, economists, tax practitioners, and others about making changes to our federal and state tax systems. Some of the proposed changes are fundamental in that they would, for example, replace the federal income tax with a consumption tax. Other people propose varying degrees of change to the existing federal tax system, like adding or expanding tax incentives to encourage savings, modernizing the international tax rules to better address today's global economy, or making procedural changes to improve compliance. The most important question is how should proposed changes be analyzed? The American Institute of Certified Public Accountants (AICPA) has issued suggestions for Federal tax policy. The suggestions analyze fundamental tax-reform proposals. AICPA determined that the proposal debate was missing an analytical framework to determine whether the proposals incorporated principles of "good" tax policy. AICPA created a framework to present the principles of a good tax system; it can be used both to analyze proposals and to modify them (if necessary), so that any changes will strengthen the tax system, rather than weaken it. It can also serve to identify and design improvements to the tax system.
The framework can be used to analyze tax proposals of any size, degree and at any government level. The framework is titled “Guiding Principles of Good Tax Policy: A Framework for Evaluating Tax Proposals. Sets 10 tax principles that are commonly used as indicators of desirable tax policy. Incorporating those principles into the