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Explain to me why you can't just eliminate taxes and instead nationalize the entire economy and just take a percentage of margins of the nation's economy to fund the state.

It would better obfuscate the fact that a third of one's wage is stolen for the purposes of supplying a gravy train for people that hate you and want you dead. It would also, on paper, be easier to manage. The individual doesn't have to worry about filing their taxes every year unless they're a small business owner - that responsibility is done by a state representative whose job is to manage the percentage of margin taken every year for use by the state.

I guess one of the reason's why it *might* not work is that the transition would be too complicated for the bureaucracy to handle - transfer cost and all that.
> instead nationalize the entire economy

Because the people who end up running the farms and factories are the politically connected, and they are so inefficient everything collapses and everyone starves. See: communism.

The whole "people who built it are the ones best equipped to run it" thing is unbeaten.

> The individual doesn't have to worry about filing their taxes

Oh, plenty of ways to achieve that, but a lot of income tax is about being able to lord over people and threaten them with an audit.

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