I'm not sure if your are talking about the US but will discuss that. The main reason for all of this is politics.
Some groups advocate a flat tax or even a sales tax to simplify the convoluted system we now have, but that has not gained much real traction.
During a time that, one party was able to exert its will, they were successful in lowering the tax rates for dividend income and long term capital gains. So if you and your neighbor have the same income, and have the same deductions one could pay a lot less taxes if they have a lot of dividend income.
During a different time, the earned income credit came into being and has been expanded since. The result is those with lower incomes, that pay little or no tax get a relatively huge tax refund. Often times this is used on a down payment for a car. Both parties like this because it helped their major contributors.
When Pres. Obama was in office he used the IRS to invoke penalties on those that had no health care. What does income taxes have to do with health care?
So to be clear, I think, all of these policies are crap and representative of both political parties.
Unfortunately there is a lot of incentive to perpetuate the system we currently have.