Attitudes to tax policy: Politics, self-interest and social values

Abstract

The attitudes that the community hold to taxation policy are commonly understood from the perspective of self-interest. Drawing on rational actor theory, tax policy is expected to find favour when it financially benefits the taxpayer and disfavour when it financially disadvantages the taxpayer. Following this line of argument, taxes that are costly to the community, such as a goods and services tax (GST), should receive a negative evaluation overall. Cuts to income tax, on the other hand, should be regarded more favourably, being supported by all beneficiaries. Two problems arise with this argument. First, evaluations of the GST are not as uniformly negative as might be expected. Similarly, evaluations of income tax cuts are not as uniformly positive as might be expected. The data presented in Tables 1 and 2 show variability in community attitudes to the GST and tax cuts respectively. Show more