Projects per year
Abstract
We study attitudes towards the introduction of hypothetical new taxes to finance the cost of the COVID-19 pandemic. We rely on survey data collected in Luxembourg in 2020. The survey asks for the agreement of respondents over: a one-time net wealth tax, an inheritance tax, a temporary solidarity income tax, and a temporary increase in VAT. All questions include different and randomly assigned tax attributes (tax rates and exemption amounts). We find a clear divide with relatively high support for new wealth and inheritance taxes on the one hand and a low support for increases in VAT and income taxes on the other hand. While 58% of respondents agree or strongly agree with a one-time tax levied on net worth, only 24% are in favor of a small increase in VAT. Support for any tax is however negatively associated with the size of the tax as measured by the predicted revenues. Our results indicate that a one-time wealth tax could raise substantial revenues and still garner public support.
Original language | English |
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Pages (from-to) | 1395-1418 |
Number of pages | 24 |
Journal | International Tax and Public Finance |
Volume | 29 |
Issue number | 6 |
Early online date | 25 Jul 2022 |
DOIs | |
Publication status | Published - Dec 2022 |
Bibliographical note
Funding Information:This research was supported by the Luxembourg Fonds National de la Recherche [PREFERME grant C17/SC/11715898; FAREWELL-to-C19 grant COVID-19/2020-2/14864519; and SEI project grant COVID1-19/2020-1/14704944]. We are grateful to the Editor, two anonymous referees, and participants at the University of Luxembourg's IRSEI Brown Bag seminar, the 9th ECINEQ conference, the 77th Annual Congress of the International Institute of Public Finance, the 24th ALdE conference, and the JRC's Fiscal Policy Analysis Unit seminar for helpful comments.
Funding Information:
This research was supported by the Luxembourg Fonds National de la Recherche [PREFERME grant C17/SC/11715898; FAREWELL-to-C19 grant COVID-19/2020-2/14864519; and SEI project grant COVID1-19/2020-1/14704944]. We are grateful to the Editor, two anonymous referees, and participants at the University of Luxembourg's IRSEI Brown Bag seminar, the 9th ECINEQ conference, the 77th Annual Congress of the International Institute of Public Finance, the 24th ALdE conference, and the JRC's Fiscal Policy Analysis Unit seminar for helpful comments.
Publisher Copyright:
© 2022, The Author(s), under exclusive licence to Springer Science+Business Media, LLC, part of Springer Nature.
Keywords
- COVID-19
- Income tax
- Inheritance tax
- Preferences for redistribution
- VAT
- Wealth tax
Projects
- 1 Finished
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PREFER-ME: Preference for Redistribution, Equality and Fainess in Europe and in the Greater Region: Micro-Evidence from Surveys
Andreoli, F., Olivera, J., Sologon, D., Fusco, A., Van Kerm, P. & Rueda, D.
Luxembourg Institute of Socio-Economic Research (LISER), Luxembourg National Research Fund (FNR)
1/04/18 → 31/03/22
Project: Research
Research output
- 1 Working paper
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Public support for tax policies in COVID-19 times: Evidence from Luxembourg
Olivera, J. & Van Kerm, P., 19 Nov 2021, Esch-sur-Alzette: LISER, 32 p. (Working papers; no. 2021-10).Research output: Working paper
Open AccessFile