We also need one another to make possible the benefits of civilization. We must somehow gain far more from one another with each increase in numbers than we lose by mutual constraint, by mutual restraint, and by scarcities. To the extent we fail to address many of our common needs, we tend to force matters and, in order to do this, amass stakes of power and government. People contending for those stakes aren't always very nice people, and even those who are, might not be as well behaved as they would be when not contending for or defending their stakes. Amassing those stakes of power, we tax for the means to spend on these matters, with little or no regard as to how the incidence of tax affects behavior.
People go to great lengths, indeed spectacular lengths, to find loopholes and tax breaks.
What we've failed to do is to arrange the loopholes and tax breaks in the right places. Example of an external diseconomy is downwind or downstream pollution. Example of an external economy or benefit is to shovel the snow off the sidewalk in front of your house or shop. Diseconomies get routinely inflicted upon the rest of us unless restrained or unless counter-incentivized, because their providers feel only a small part of the costs of their activities but all or most of the benefits. Using countervailing incentives to let natural market mechanisms operate over these areas would be far more efficient, and greatly reduce not only the tax burden but the concentrated stakes now represented by government.