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Are happier taxpayers willing to pay higher taxes?

Author

Listed:
  • Raluca Tudorică

    (West University of Timișoara, Romania)

  • Sorana Vătavu

    (West University of Timișoara, Romania)

Abstract

This paper aims to study the relationship between taxation and citizens behaviour and happiness, through the analysis of a questionnaire, focused on identifying whether or not citizens would be willing to pay higher taxes to benefit from better public services offered by the government. We observed the main characteristics of the tax system in Romania compared to other countries, making a comparison and explaining the best scenarios in each country through the latest taxation trends, and we studied the impact of taxation on the citizens’ behaviour, feelings, and well-being. We observed how progressive taxation influences people s well-being, satisfaction, and happiness. The analysis was built upon 114 questionnaire responses and the results are described through descriptive statistics and correlations. The main result indicated that indeed, citizens would pay higher taxes to receive better public services, and the answer to the question Are happier citizens willing to pay higher taxes is undoubtedly affirmative. Accordingly, citizens would pay higher taxes as long as the government will keep them safe, ensuring an increased level of satisfaction and well-being.

Suggested Citation

  • Raluca Tudorică & Sorana Vătavu, 2020. "Are happier taxpayers willing to pay higher taxes?," Journal of Financial Studies, Institute of Financial Studies, vol. 9(5), pages 72-85, November.
    • Handle: RePEc:fst:rfsisf:v:5:y:2020:i:9:p:72-85
    DOI: 10.6084/m9.figshare.13621778
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    References listed on IDEAS

    as
    1. Alpaslan Akay & Olivier Bargain & Mathias Dolls & Dirk Neumann & Andreas Peichl & Sebastian Siegloch, 2012. "Happy Taxpayers? Income Taxation and Well-Being," SOEPpapers on Multidisciplinary Panel Data Research 526, DIW Berlin, The German Socio-Economic Panel (SOEP).
    2. Onu, Diana & Oats, Lynne, 2016. "“Paying tax is part of life”: Social norms and social influence in tax communications," Journal of Economic Behavior & Organization, Elsevier, vol. 124(C), pages 29-42.
    3. Knut Røed & Steinar Strøm, 2002. "Progressive Taxes and the Labour Market: Is the Trade–off Between Equality and Efficiency Inevitable?," Journal of Economic Surveys, Wiley Blackwell, vol. 16(1), pages 77-110, February.
    4. Blanchflower, David G., 2000. "Self-employment in OECD countries," Labour Economics, Elsevier, vol. 7(5), pages 471-505, September.
    5. European Commission, 2020. "Taxation trends in the European Union: 2020 edition," Taxation trends 2020, Directorate General Taxation and Customs Union, European Commission.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    taxation; happy taxpayers; well-being; public services; satisfaction;
    All these keywords.

    JEL classification:

    • H2 - Public Economics - - Taxation, Subsidies, and Revenue
    • H3 - Public Economics - - Fiscal Policies and Behavior of Economic Agents
    • I31 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General Welfare, Well-Being

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