"What is needed is to make taxation fair by simply saying that if you get $ from a source, ANY SOURCE, then it will be taxed in the same way with NO BREAKS, DEDUCTIONS, OR EXEMPTIONS."
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That is where you went off the rails. For example, take a retailer who makes $100K in sales of merchandise that cost him $80K, and he has another $10K in overhead costs. By your argument, he should be taxed on the $100K gross receipts rather than the $10K profit. Most people would argue that is anything BUT fair. On the other hand, if you agree that he should be taxed on the $10K, your emphatic prohibition is out the window. 
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The idea that wage earners, heirs, investors, game winners, etc. should be taxed at the same rate for a given level of income is defensible, even reasonable. The idea that we should eliminate all adjustments to taxable income is neither.