People will reason that if they keep some of their money out of the grubby hands of the tax man is still going back into the community to pay for goods and services. So if they spend £100 on the weekly shop at Tesco it is going somewhere they know and approve of - towards providing goods, jobs and services in the community. Rather than being wasted on vanity projects or poor and corrupt procurement by the MOD.
In theory, friendlygingercat, even though that £100 may have been kept of the grubby hands of the tax man at that point it will still get back to those 'grubby hands' as it circulates through the economy. Unless, of course, everyone embraces the black economy, which would result in financial anarchy and inflation.
Your last sentence will strike a chord with most people, I think, because most people have their own pet 'hate project' which they regard as unnecessary and/or money wasting. But even those projects will be putting money into people's pockets to circulate in the economy and be taxed back as it circulates.
The biggest problem, though, is that they will be putting the greater part of the money into the hands of the already wealthy, company owners, CEOs, shareholders and the like who will be far less likely to spend it into the domestic economy and who have the best tax exemption concessions and the best tax avoidance schemes, so it will be less likely to be taxed back.
These are, of course, the people who are most likely to be approved of and defended on this forum... Even though they are taking the p*ss with many of their charges (remember the 'bat shelter'?) and running rings round the civil service procurement departments...😕