De Marco claimed that tax-payers are more certain of their liabilities in a single tax and this can help in a more equitable distribution of the tax burden and in reducing cost of collection. As against these claims, there are problems of identification and choice of an appropriate single tax the determination of rate schedule, the adequacy and growth of revenue, and its role in promoting national objectives.
A single tax system presented many difficulties. It proved inefficient in solving the real purpose behind a good tax system. Consequently, economists now widely acclaim multiple tax system.
A multiple tax refers to the tax system in which taxes are levied on various items or bases. A modern economy is not one objective economy. It tries to forge ahead simultaneously along the paths of growth, equitable distribution of income and wealth, economic stabilisation, and soon.
And since no single tax can be expected to help the economy on all fronts, a choice for a multiple tax system becomes inevitable. Different taxes contribute to the attainment of different objectives.
Thus, some taxes would help the economy in the direction of regional balanced growth. Still others may be needed so as to provide adequate revenue for the government treasury, and so on.
The other advantages of multiple tax system are that it is efficient in checking the tendencies of frequent tax evasion. It increases the tax revenue of the government. It is more flexible than the single tax system.
Income in a modern economy originates from many sources, justice and equity would demand that state should tax all the important sources of income in an equitable manner. One kind of taxation can remove the weaknesses of the other kind of taxation.
However, a multiplicity of taxes is undesirable and should be avoided. A large number of taxes would involve a high cost of collection. It is therefore best to rely on a few substantial taxes for achieving the major portions of the tax revenue.