When alcohol became legal in the U.S. in 1933, politicians got to tax it. They never looked back. Yet, antipathies to other "vices" are so powerful that even the prospect of new revenue sources has not been enought to get them to legalize, say, prostitution or pot. (Even congestion pricing has been a hard sell.)
But why be subject to the trade-off? Keep it illegal and tax it too. According to "A fine too far" in the Feb 20 Economist, quite a few governments do attempt to tax illegal stuff.
Yes, the report mentions Kafka. How did he know all this?