The burden of new taxes: acceptance of taxes as a function of affectedness and egoistic versus altruistic orientation

Abstract

Taxes imply loss of individual freedom to dispose of one's own money as one wishes. From a psychological viewpoint it is reasonable to assume that people reject the introduction of new taxes if they are affected by them and have to contribute more to the tax authorities than in the past. It can also be assumed that personal value orientation such as selfishness and altruism, respectively, influence attitudes towards taxes. Moreover, personality traits, such as norm dependency, and age should affect one's acceptance of taxes. This study investigates the attitudes of 120 persons affected by a new tax and 113 persons not affected by the tax. Norm dependency, egoistic versus altruistic value orientation, tax mentality and tax morality as well as demographic characteristics were assessed by questionnaires. The results indicate that both affectedness and value orientation determined attitudes towards the new tax. Age and norm dependency are correlated with attitudes towards taxes in general. The hypothesized interaction effect between affectedness and value orientation was not confirmed. However, affected egoists, nonaffected egoists, affected altruists, and nonaffected altruists, respectively, mentioned different reasons for and against taxes, tax increases, and the introduction of new taxes.