> <i>As Merchants are not anonymous, they can be taxed, enabling income or sales taxes to be withheld by the state while providing anonymity for Customers.</i><p>Pulling this off in the United States sounds somewhere between very challenging and impossible.<p>Sales tax is not uniform. Rates vary not only by state but also at a local level. In some states, sales taxes can be imposed by the state, by counties, by cities, by school districts, by transit authorities, and by other entities like special purpose districts[1].<p>Which ones (plural) of these sales taxes (plural) apply to a transaction depends on the <i>buyer's location</i>.<p>In many cases, knowing the buyer's city, state, and zip code is <i>not granular enough</i>. For example, the boundaries of a school district may not correspond to zip code or city.<p>The typical approach today is to collect the buyer's full address. From that, there are databases that will tell you the list of jurisdictions and taxes that apply. Obviously, that's not very anonymous.<p>Maybe you could have the buyer determine all of the jurisdictions/taxes that apply to them and send only that info instead. That's less granular, but in some cases it might give away a lot of information. (Sort of like browser fingerprinting.)<p>But if you do that, I'm not sure what the implications would be for sellers. Sellers are required to collect the sales tax and remit it to the state. They can get in trouble for not doing it right. Governments don't like it when their taxes don't get collected, so they sometimes create laws that put the burden of compliance on the seller.<p>---<p>[1] Special purpose districts could allow a county or local government to, for example, pick an arbitrary area and impose a sales tax within it just to support libraries that serve that area. Or crime prevention, road improvement, emergency services, hospitals, parks, economic development, etc.