OK.. seems I was under a major misconception about how US taxation operates, I naively assumed it was similar to other countries' federal+state structures.
No worries, when it comes to governance in the US just assume the most absurd possible outcome of what seemed like a great idea 250 years ago in a country of 2.5 million people in 13 states, and less than 100 towns we would consider cities today, applied to a country of 220 million people in 50 states and 19000+ cities \o/