Because it leaves the spirit(s) free to soar again. Instead of being imprisoned by a lie!
Aside from (say) keeping a surprise party quiet, I'd say it is. That way, people know where they stand with you, and you don't tie yourself up in knots keeping the lies straight. And if people know you're always honest with them, they know that even if you say something negative ("yes, your bum *does* look big in that") you're not doing it to hurt them.<br />
The truth will out, eventually, so why wait?
You sleep soundly and don't have to cover your tracks
If it can be done without damaging others Yes. And why? Because its easier to remember the truth.