Progressive taxes often face resistance from affluent citizens. This paper argues that trust in political institutions, rather than mere coercion, is key to gaining their support for higher tax burdens.
Data & Methods:
Using public opinion data from the 2012 LAPOP surveys across several Latin American countries (including Argentina, Brazil, and Chile), we analyze attitudes toward taxation among high-income earners. The analysis employs logistic regression to model relationships between trust levels and tax preferences.
Key Findings:
High-income individuals in Latin America are more supportive of progressive income taxes when they express strong trust in political institutions. This relationship holds despite potential concerns about fairness or other factors, indicating that institutional confidence is a primary driver for compliance with the fiscal contract.
The findings highlight that tax policy design must incorporate elements to build public trust if it aims to secure broader acceptance from wealthier citizens.
| Taxing Higher Incomes: What Makes the High-income Earners Consent to More Progressive Taxation in Latin America? was authored by Sarah Berens and Armin von Schiller. It was published by Springer in Pol. Behav. in 2017. |
