What Would Happen to Taxes if Cash Were Banned?

Here is a little exercise in Public Choice economics: If a government banned cash (as some are proposing), what would happen to its tax rates? Answer: they would increase as the cost of tax resistance would be lower and Leviathan would take advantage of this. On this topic, see my article “The Economics of Tax Dodging” in the Library of Economics and Liberty. The same would happen to a lesser extent if the size of large denominations is further restricted.