This paper develops a theory of optimal taxation with behavioral agents. We use a general
behavioral framework that encompasses a wide range of behavioral biases such as misper-
ceptions and internalities. We revisit the three pillars of optimal taxation: Ramsey (linear
commodity taxation to raise revenues and redistribute), Pigou (linear commodity taxation to
correct externalities) and Mirrlees (nonlinear income taxation). We show how the canonical
optimal tax formulas are modi?ed and lead to a rich set of novel economic insights. We also
show how to incorporate nudges in the optimal taxation frameworks, and jointly character-
ize optimal taxes and nudges. Under some conditions, the optimal tax system is simple, in
the sense that all tax rates are equal. For instance, all goods are optimally taxed at the
same rate (or a few di¤erent rates), and the optimal income tax features just one marginal
tax rate (or a few di¤erent marginal tax rates). This contrasts with the traditional optimal
tax results, that generically features complex tax systems that depend on the details of the
environment. Finally, we explore the Diamond-Mirrlees productive e¢ ciency result and the
Atkinson-Stiglitz uniform commodity taxation proposition, and ?nd that they are more likely
to fail with behavioral agents