Diffuse traces and Haar unitaries

We show that a tracial state on a unital C*-algebra admits a Haar unitary if and only if it is diffuse, if and only if it does not dominate a tracial functional that factors through a finite-dimensional quotient. It follows that a unital C*-algebra has no finite-dimensional representations if and only if each of its tracial states admits a Haar unitary. More generally, we study when nontracial states admit Haar unitaries. In particular, we show that every state on a unital, simple, infinite-dimensional C*-algebra admits a Haar unitary. We obtain applications to the structure of reduced free products. Notably, the tracial reduced free product of simple C*-algebras is always a simple C*-algebra of stable rank one.