Public Support for Tax Policies in COVID-19 Times: Evidence from Luxembourg

Olivera, Javier; van Kerm, Philippe

doi:10.1007/s10797-022-09744-y

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29 December 2022

Article (Scientific journals)

Public Support for Tax Policies in COVID-19 Times: Evidence from Luxembourg

Olivera, Javier; van Kerm, Philippe

2022 • In International Tax and Public Finance, 29, p. 1395-1418

Peer reviewed

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https://hdl.handle.net/10993/53406

DOI
10.1007/s10797-022-09744-y

PubMed
35909671

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Keywords :

wealth tax; COVID-19; inheritance tax; preference for redistribution; VAT; income tax

Abstract :

[en] 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.

Disciplines :

Sociology & social sciences
Social economics

Author, co-author :

Olivera, Javier; Luxembourg Institute of Socio-Economic Research - LISER

van Kerm, Philippe ; University of Luxembourg > Faculty of Humanities, Education and Social Sciences (FHSE) > Department of Social Sciences (DSOC)

External co-authors :

Language :

English

Title :

Public Support for Tax Policies in COVID-19 Times: Evidence from Luxembourg

Publication date :

2022

Journal title :

International Tax and Public Finance

Volume :

Pages :

1395-1418

Peer reviewed :

Peer reviewed

Funders :

FNR - Fonds National de la Recherche

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