[farnja]

" Companies have many accounting tactics for reducing their declared profits – so if the tax is levied on profits, they will likely game the system. "

The solution for this is not taxing revenue, which as mentioned in other comments would destroy a lot of legitimate business models, but instead, improving the art of accounting. It suffers from the same plague of "large corporations with out-sized political power" and the sway of a lot of misaligned incentives. Putting in one stop-gap solution for another doesn't seem like the best way to fix the system.

[bjustin]

Given that lawmakers are people, we will never have a perfect legislative system. Were we to somehow get a perfect, loophole free tax code, it will suffer death from a thousand papercuts. Lawmakers will get provisions that benefit their states at the expense of the others, and we eventually end up around where we are now. For example, they decide how you should calculate profits from revenue & expenses.

Taxing revenue not only limits methods that businesses can use to reduce their tax burden, but also limits opportunities for corruption or favoritism as compared to taxing profits.