Hidden transactions are a problem in any somewhat free economy, whether it's insurance, club dues, auto payments to service providers, or taxes. The usual sales point is that "But you don't have to think about them!" and the problem is that you never think about them -- when you should.
That's not saying taxes should be onerous or deliberately painful -- any more than paying your bank's monthly fees should be onerous or painful. But none of those should be invisible, either. Transactions that are never consciously reviewed are never scrutinized for value. That's no long-term good to either participant in the transaction.
Nobody's advocating taxes as "hidden" transactions. You used the example of your bank's monthly fees... which is far less transparent than this suggestion. My bank simply emails me a reminder to check my account with them once per month. It doesn't allow me to contest or correct their accounting at all.
Your fear -- that by removing the hassle of tax preparation, people will dwell in blissful ignorance of their tax burden and the government will jack up tax rates -- is not borne out by my experiences in countries where return-free tax filing is the norm.
That's not saying taxes should be onerous or deliberately painful -- any more than paying your bank's monthly fees should be onerous or painful. But none of those should be invisible, either. Transactions that are never consciously reviewed are never scrutinized for value. That's no long-term good to either participant in the transaction.