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You are proving my point. If we can't stop illegal drug sales, it means we probably can't tax it either, whether home made, home grown or smuggled. If we set up a high retail sales tax, the same thing can happen with almost any merchandise.

I would like to scrap the IRS code. After that it could be rewritten, written with a flat tax, or written with a sales tax. Any of those options would be better than the status quo, but they have to be thought through. The extremely unsuccessful war on drugs shows the difficulty of controlling the sale of illegal substances. With a high sales tax, all untaxed substances will be illegal.

These items can be home grown, home made, smuggled, grey market, or merchandise that got "lost" during shipment. The good part about this evasion is I will be able to buy certain things anonymously. The bad part is it seems like it will be really easy, and the government would have to raise the rate for easily trackable items like large appliances and cars. It seems like many other items could be built in cottage industries from wholesale parts.

A second drawback of enforcement is intrusion upon small tradesmen and craftsmen. The ones who sell privately would have to risk their business or sell at a disadvantage to the black marketeers. It would be difficult to stop craftsmen from bartering their products or establishing bogus pricing without intrusive enforcement driving the legitimate ones out of business.

The most important drawback is the government would inevitably figure out solutions to these problems at the cost of my privacy.

You are proving my point. If we can't stop illegal drug sales, it means we probably can't tax it either, whether home made, home grown or smuggled. If we set up a high retail sales tax, the same thing can happen with almost any merchandise.

I believe the EU did a study on this, and when sales tax went above 12%, tax avoidance went through the roof. Some people see the sales tax as some kind of savior to intrusive government, but it is not.