I'd disagree on the loopholes being an argument for increasing the tax rate.
Too often loopholes (and tax avoidance) are the convenient excuse, the easy target. People think it means that rich people are getting out of paying taxes that they ought to, often without fully understanding just what a loophole is. In particular the use of the phrase tax avoidance is used by politicians and those advocating higher taxes in such a way as to imply they view it as tax evasion.
Firstly avoidance vs evasion. Evasion is basically breaking the law - you're meant to pay taxes, but you don't (e.g. you report your income as far below what it was). Avoidance however is using legal means to legitimately reduce your tax bill.
Now on to the loopholes/avoidance issue. Lets say the government wants to encourage individuals to give money to charity. To encourage this, they allow any donations to count as an expense for tax purposes. So if you run a business and you make $100k revenue, and against that you have costs of business of $50k, and you then give $10k to charity, you're taxed on $40k rather than $50k. This would count as tax avoidance though - you're avoiding paying taxes on that $10k. However, close that tax avoidance system and you've just removed a major incentive for people to donate money. The tax system can be used in numerous other ways to provide incentives for people to do things, and inevitably when you do this, you will both allow people to avoid paying taxes, and have unintended consequences where people who you didn't at first think of will also use such incentives to cut their taxes.
Now loopholes also covers not just tax avoidance, but unintended consequences of legislation. That is the government might bring into effect some complicated law that they think will cause people to pay taxes in situation X but allow them to avoid paying them in situation Y, but it actually allows people in situations Y and Z to avoid paying taxes. Now where should the blame lie here, with the people in situation Z taking advantage of a 'loophole' to legitimately reduce paying their taxes, or the people who created that loophole in the first place, the government? Furthermore when looking to fix this problem, do you think people in situations A-X should be punished with a higher level of tax because people in situation Z are managing to pay less than they should, or do you think the loophole itself should be looked at? Also if you do increase the tax rate more, you increase the tax that those people will pay if they carry on as before, and hence increase the incentive for them to use a tax advisor who specialises in finding ways to reduce the tax they pay legitimately [i.e. uses loopholes/tax avoidance], meaning you actually then increase the problem!
This suggests of course that the solution to loopholes is even more legislation to cover them. However past history has shown that governments aren't exactly competant when it comes to taxes, and for every problem they try to fix, two more can spring up in it's place. In many ways just creating a very simple tax system with very few 'incentive' (or avoidance) items in it, and looking at the tax system overall (for example not focusing solely on taxes on income while ignoring capital gains, and hence giving a strong incentive for people to try and make normal income count as a capital gain, or vice versa) would solve many of these problems. This is, incidently, another bonus point for a flat rate system - it's far simpler, so not only will it be less costly for people to deal with, but the government might also get a better idea of how it works and so create fewer loopholes in the first place.
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