Most people think of tax burden as the amount of tax that is paid. Rarely does anyone think of the cost of complying with the provisions of the Income Tax Act. Government is costing us more than the taxes we see, because it's difficult to see the extra cost of complying with government regulations. But if you come to think of it, there is a host of other expenditure involved apart from preparing the return of income and paying the tax. They extend from simple expenditure of taking photocopies of the documents to be filed with the return, to fees to experts and other administrative cost. Americans are adept at digging into what we may ignore as trivia. In USA it was estimated that individuals, businesses and non-profit institutions spent an estimated 5.8 billion hours in 2002 complying with the federal income tax code, with an estimated compliance cost of over $194 billion. This amounts to imposing a 20.4 % tax compliance surcharge for every dollar the income tax system collects. In India a socio economic research study initiated by the Planning Commission observed that among 20 countries the cost ranged from 0.36% to 28% of the tax paid while in India itself it went upto 14.5% not including bribes. In addition it is regressive in the sense that the cost is more for the lower tax payers and less for for higher tax assessees. I could not find any study of the cost to third parties of complying with tax collection at source. This is a classic case of outsourcing the collection process without any payment for it and I thought it is worth a look.