The solution is that you pay any of your disposable income to the government to compensate for this.
But to the point: Many merchants just want to skip the fees, it usually has nothing to do with taxes. Small business owners get riled up about CC fees sometimes.
Plenty of people in countries with functioning public services and social safety nets.
> Merchants refusing taxes are just as legit as those who chose to pay taxes
As a point of pedantry, they’re in fact illegitimate in the literal sense. (I don’t intend this point as serious argument, just thought your phrasing was bit funny in the context)
> Many merchants just want to skip the fees
I completely agree with you here, it can make sense for a small business to prefer cash for that reason (and it’s equally okay for a customer to choose whether to do business with them).