One could imagine a world in which taxes are paid only to the states, which then must all pay to fund the federal government. Not saying it's a good idea, but it would certainly be different from what we have now.
In Australia we only pay federal taxes, and get distribute to the various states.
The tax is wonderfully simple for us, and I THE MAIN seems to work ok for states. Every now and then one state gets a bit tetchy about it, but it appears to work out OK.
