Not my taxes! Explaining tax resistance and its implications for Australia's welfare state

Research output: Contribution to journalReview articleResearchpeer-review

Abstract

In discussing Australia's need to increase taxes to pay for future social security, Michael Keating worries that voters see taxes as a 'burden' and that 'the link between taxation and citizenship has been broken'. This paper deals with the problem of tax resistance (preferring lower taxes even when tax cuts risk public services) for Australia's welfare state. First, I describe how two Australian fiscal institutions-a residual welfare system and visible income taxes-promote tax resistance among voters. Second, I draw on these insights to develop several explanations for tax resistance: voter self-interest, voter hostility to minorities, voter disengagement (low trust and lack of interest in politics), and individualistic attitudes. The main conclusion is that tax resistance in Australia is institutionalised, making it easier to mobilise interests around low taxes, and harder to advocate for alternatives. Results of multivariate analysis using AES 2004 data indicate that an 'anti-tax coalition' can build on three diverse publics; one of higher and middle-income earners attuned to self-interest, another hostile to welfare beneficiaries, and another 'tuned out' of politics and willing to support any call for tax cuts. Inevitably, the debate about the welfare state is shadowed by a debate about voter willingness to pay taxes that finance it.

LanguageEnglish
Pages517-535
Number of pages19
JournalAustralian Journal of Political Science
Volume41
Issue number4
DOIs
Publication statusPublished - 1 Dec 2006

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taxes
welfare state
voter
welfare
tax increase
politics
disengagement
income tax
willingness to pay
taxation
social security
multivariate analysis
public service
coalition
finance
citizenship
minority
income
lack

Cite this

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title = "Not my taxes! Explaining tax resistance and its implications for Australia's welfare state",
abstract = "In discussing Australia's need to increase taxes to pay for future social security, Michael Keating worries that voters see taxes as a 'burden' and that 'the link between taxation and citizenship has been broken'. This paper deals with the problem of tax resistance (preferring lower taxes even when tax cuts risk public services) for Australia's welfare state. First, I describe how two Australian fiscal institutions-a residual welfare system and visible income taxes-promote tax resistance among voters. Second, I draw on these insights to develop several explanations for tax resistance: voter self-interest, voter hostility to minorities, voter disengagement (low trust and lack of interest in politics), and individualistic attitudes. The main conclusion is that tax resistance in Australia is institutionalised, making it easier to mobilise interests around low taxes, and harder to advocate for alternatives. Results of multivariate analysis using AES 2004 data indicate that an 'anti-tax coalition' can build on three diverse publics; one of higher and middle-income earners attuned to self-interest, another hostile to welfare beneficiaries, and another 'tuned out' of politics and willing to support any call for tax cuts. Inevitably, the debate about the welfare state is shadowed by a debate about voter willingness to pay taxes that finance it.",
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Not my taxes! Explaining tax resistance and its implications for Australia's welfare state. / Wilson, Shaun.

In: Australian Journal of Political Science, Vol. 41, No. 4, 01.12.2006, p. 517-535.

Research output: Contribution to journalReview articleResearchpeer-review

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