Does climate change concern alter individual tax preferences? Evidence from an Italian survey

Purpose - This paper analyzes the role that the climate change concern (CCCi) has on the willingness to accept an environmental tax. The author aims to grasp how individual general tax preferences can differ with respect to the specific (environmental) tax. He focuses attention to the Italian case since it has been argued that the potential acceptability of a carbon tax in Italy is relatively high, and this topic has been scarcely explored so far among Italian citizens (Rotaris and Danielis, 2019). Design/methodology/approach - The author conducted an online survey among 514 Italian economics students. Findings - The CCCipositively influences the environmental tax morale (ETMi). The general tax morale (TMi)positively affects the specific (environmental) TMi. The CCCialters individual tax preferences. The author evidenced that also subjects with low TMiturned out to be willing to pay an environmental tax if aware of the environmental issues. Research limitations/implications - Although the author used a common methodology in this strand of research, he is aware that in an online survey individuals can be influenced by the self-reporting and hypothetical choice bias (see Swamyet al., 2001), that in turn can characterize their reported preferences. Moreover, even if economics university students are commonly used as a subject pool in experimental economics settings, and although several studies showed that the behavioral responses of students are largely the same as those of nonstudents in identical experiments (for a discussion see Alm, 2012; Chooet al., 2016), there is awareness that in this case, they are not taxpayers yet (Barabas and Jerit, 2010). Practical implications - The author’s results remark the importance of increasing climate change awareness among people to let them be more willing to pay the environmental tax, for instance through investments in sensibilization campaigns on the importance of energy source usage and climate-related topic. Then, an increase in the general TMileads to an increase in the specific (environmental) TMi. The author’s evidence showed that people with high tax morale logically recognize the positive impact of paying an environmental tax when the CCCiincreases, since the more the theme becomes important, the larger the willingness to pay the specific tax. For this reason, policymakers should carry on campaigns to increase the general level of TMito increase the overall tax compliance level and the relative tax revenues, following the guidelines given by the Organisation for Economic Co-operation and Development (2019) to support taxpayer education programs, such as including TMiresearch and analysis into education programs, improving the ease of paying taxes or strengthening revenue–expenditure links to build the social contract. Social implications - It should be paramount to increase awareness about environmental topics among people in general and among those who are relatively tax immoral. The author’s results remark on the importance of targeting energy and environmental tax policies to groups rather than to individuals. According to this evidence, we support the use of nonmonetary tools to nudge people in the environmental transition by changing their behavior in energy use, for instance through the taxation on fuel and other nonrenewable energy resources. Originality/value - It is the first empirical study that analyzes the impact of CCCion the environmental TMiin Italy, in particular controlling for the role of the general willingness to pay taxes (TMi). To obtain individual attitudes toward tax payment, most of the empirical studies in behavioral economics employ international surveys. For studies across citizens living in European countries, the European Social Survey (ESS) and European Values Study (EVS) represent the most used ones (see, for instance, Martinez-Vazquez and Torgler (2009) in Spain; Torgler and Werner (2005) in Germany; Nemore and Morone (2019) in Italy). However, these surveys do not allow to study the relationship between the environmental and general TMiacross the same subject pool. In fact, despite the ESS (2016) provides individual responses about the willingness to pay an environmental tax, it does not provide information about the general individual attitude toward tax payment (this information is contained only in the ESS wave of 2004, hence referring to a different subject pool). On the contrary, each wave of the EVS (i.e. 2008, 2017) provides information about the general individual attitude toward tax payment, but this survey does not provide a question regarding the willingness to pay an environmental tax. Therefore, to obtain information about the willingness to pay both general and environmental taxes, across the same subject pool, it is needed to carry out a survey.