At the risk of being controversial here, or being labeled a socialist (ooooh, knee jerk fear reaction from people who haven't looked at democracy close enough to get the joke
) the following things should be legal but taxed and/or regulated:
All drugs
Drugs are readily available if you look hard enough anyway, legalisation would (hopefully) have the following positive effects:
1) Assured quality and control rules
2) Cheaper product available on the open market effectively destroying the expensive, underground distribution systems. No more drug mules.
3) Increase in government tax revenue to be used for the good of all. Possibly lower income taxes as a result.
Prostitution:
Repeat items 1 and 3 above
1) Illeagal sex trafficking would be greatly harmed as sex trade investigators would be able to concentrate only on involentary prostitution (slavery, kiddies).
2) Government regulated brothels would instigate health checks, reducing the chances of accidental STD infection.
Genetic Research
This particular issue is a tough one. I would dearly like to see the results of drugs destroying genetic diseases and assisting against other forms of disease. Immortality for humans is probably a bad idea. Genetic weapons for the military, also a bad idea.
Things that should be legal, but not regulated by the government or any religious body:
Abortion
Women have the right to decide what happens with their body. This is perfectly legal in a lot of countries, including my own.
Euthenasia
The right to death has historically been the right of anyone in any society. It's only in the last few hundred years that choosing for an otherwise incapacitated and hurting loved one to die is a bad thing. This is clearly subject to personal circumstances but should not be dismissed out of hand as murder.