Bitcoin is not designed for taxes to be paid on it. I beleive the best for government maybe to tax bitcoin users and make it more popular. Just that the charges should be considerate and proportional to the excesses.
Where is you position actually? You said bitcoin isn't designed to pay tax, but the best way is applying tax. Do you agree or disagree about taxing? If it's best way for government to apply tax for bitcoin just to make it popular, bitcoin should be legalized first. When it's legal, it becomes similar to other currency. Then, perhaps people will sell their coins because they get no plus point from bitcoin, it will lead to the end of bitcoin, I guess.