Because then people who own the companies would simply keep the income in the company, and have the company pay as much of their expenses as possible as "business expenses." Essentially, they would get the benefits of the income without anyone actually paying taxes on it. The company would distribute the profits only when absolutely necessary.

Note: this scenario has already been envisioned by tax advisers. Common solutions include either converting corporations to flow-through entities for income tax purposes, or levying penalty rates of income tax on undistributed profits.