Why can’t the tag contain a tag inside it?

An authoritative place to look for allowed containment relations is the HTML spec. See, for example, http://www.w3.org/TR/html4/sgml/dtd.html. It specifies which elements are block elements and which are inline. For those lists, search for the section marked “HTML content models”.

For the P element, it specifies the following, which indicates that P elements are only allowed to contain inline elements.

<!ELEMENT P - O (%inline;)*            -- paragraph -->

This is consistent with http://www.w3.org/TR/html401/struct/text.html#h-9.3.1, which says that the P element “cannot contain block-level elements (including P itself).”

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