The argument is often made that we don’t really mind paying taxes. Unfortunately, we all have an incentive to not pay taxes.
Google, the owner of perhaps the biggest computer server “farm” in the world, is looking at ways to put their computer servers on barges 7 miles out to sea. Because they would be in international waters, they would not have to pay taxes. Here’s the Google story.
The point, of course, is that if taxes get to high, we will find ingenious ways to avoid them.