You can use cryptocurrency which hides all of your transactions (like zcash) and pay your taxes as a law abiding citizen. There is no conflict here. Tax systems rely on citizens reporting anyway.

> Tax systems rely on citizens reporting anyway

ever heard of CRS (Common Reporting Standard)?

https://en.wikipedia.org/wiki/Common_Reporting_Standard

> You can use cryptocurrency which hides all of your transactions (like zcash)

Nit: only if you use zcash shielded wallets(very rare & resource hungry) are your assets private. Most wallets use transparent addresses, which is kind of similar to normal ones.

Given current landscape, only monero is defacto private.

PirateChain and Aeon as well.

And AZTEC on Ethereum.

Tax systems follow a “trust but verify” model.

Again, not a problem. ZCash allows one to cryptographically prove transactions.

Some are even "assume bad faith and verify"

I really admire your faith in human kind.

I am fairly certain that many citizens would be tempted to become creative in their transparency (or activities) if they knew they would never get caught. Such is human nature.

> Tax systems rely on citizens reporting anyway.

It relies on reporting and the right to audit, so they may end up with all of the information anyway; it's more that you are making them ask for it rather than providing it proactively.

Not just BIPOC, any group of people you don't like.

If a tax requires the entire citizenry surrendering all of their financial privacy, it should be abolished.

And shortly after all countries would collapse...

To some, that is probably a desired feature, not a bug.

The new rulers?

Feudal lords

What system would be fair and acceptable to you?

A land tax: doesn't violate private property or privacy rights, counter-acts wealth disparity, impossible to evade, and considered the perfect tax by economists due to doing zero harm to economic efficiency.

https://en.wikipedia.org/wiki/Land_value_tax

A miniscule tax on every transaction. Automatically deducted. That's it! No other tax allowed.

By definition, financial transactions are not private, because they necessarily involve a counterparty.