If you're a "company" you get to offset money coming in with expenses and even in the most honest of systems only pay tax on the difference (i.e. the profits).

Taxing profits instead of revenue is sensible though, otherwise businesses with low profit margins would be impossible to run. Groceries would be twice as expensive since the supermarket would have to increase their profit margin by a huge amount to not go bankrupt

Individuals can but only for the stuff they need to get their income.

I mean, the whole concept of the standard deduction is based around exactly that. It's way to low to actually be that, but that's the intent.