Paying taxes less 'taxing' when we recognize how those dollars help others, study finds
There's nothing certain in life except death and taxes. But taxpayers' support for the latter could potentially be improved, according to a new study led by SFU psychology researchers Emily Thornton and Lara Aknin.
Their work, conducted alongside University of Kansas psychologist Nyla Branscombe and University of British Columbia economist John Helliwell, reveals that when taxpayers recognize their tax dollars are used to help others, they are more supportive of taxation and more willing to pay their taxes.
The researchers undertook a series of four studies that questioned participants about their views on taxation. The studies spanned a representative national sample of Americans, Canadian undergraduate students, and more than 470,000 adults from over 100 countries.
According to the Canada Revenue Agency (CRA), Canadian taxpayers who overstate deductions and understate income to minimize their taxes are contributing to an estimated $8.7-billion tax deficit.
"Many people express deep discontent about paying their taxes," says Thornton, a fourth-year psychology student and lead author of the paper.
"Some people will even go to extreme lengths to avoid paying taxes. Our findings raise an intriguing possibility—would Canadians be more willing to pay their taxes if the CRA better publicized how their tax dollars help others?"
The research, published in PLOS ONE, says the relationship between seeing how taxes help others and supporting taxation still exists when other important factors are taken into account. For instance, Thornton and colleagues found the results still hold when controlling for demographic variables, participants' general pro-social orientation, and the perception that tax dollars are being put to good use.
"These findings align with a growing body of research underscoring the pro-social nature of human behaviour," says Aknin, SFU psychology professor. "And offer a more optimistic perspective on taxation."