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Public attitudes to a wealth tax: the importance of ‘capacity to pay’

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  • Rowlingson, Karen
  • Sood, Amrita
  • Tu, Trinh

Abstract

In this paper, we present findings from the first ever study, to our knowledge, to focus in detail on public attitudes to an annual wealth tax. We start with a brief review of relevant recent studies before outlining the mixed methods used, which involved a nationally representative survey of 2,243 members of the general public and four focus groups conducted during the summer of 2020. The study aimed to measure, explore and explain the overall levels of support for a wealth tax compared with other taxes, the arguments for and against a wealth tax, and opinions on the particular design of such a tax. Key findings include high levels of public support for a wealth tax compared with other taxes, and support for the base of the tax to include financial investments and property wealth (after excluding the main home). The most popular rate/threshold combination is for the tax to be levied at a rate of at least 1 per cent over £500,000. Support for the tax appears to be driven by a combination of rational self-interest and beliefs about fairness but, in particular, the public are keen for the tax to be focused on those with capacity to contribute the most.

Suggested Citation

  • Rowlingson, Karen & Sood, Amrita & Tu, Trinh, 2021. "Public attitudes to a wealth tax: the importance of ‘capacity to pay’," LSE Research Online Documents on Economics 122998, London School of Economics and Political Science, LSE Library.
    • Handle: RePEc:ehl:lserod:122998
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    File URL: http://eprints.lse.ac.uk/122998/
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    Keywords

    CAGE at Warwick; ES/L011719/1; COVID-19 Rapid Response Grant; ES/V012657/1; LSE International Inequalities Institute AFSEE COVID-19 fund; UKRI fund;
    All these keywords.

    JEL classification:

    • E6 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook
    • N0 - Economic History - - General

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