Tax Literacy: A Canadian Perspective

Anthony Pham, Antoine Genest-Grégoire (), Luc Godbout and Jean-Herman Guay
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Anthony Pham: Université de Sherbrooke
Antoine Genest-Grégoire: Carleton University
Luc Godbout: Université de Sherbrooke
Jean-Herman Guay: Université de Sherbrooke

Canadian Tax Journal, 2020, vol. 68, issue 4, 987-1007

Abstract: Tax systems are complex structures that can be difficult for individuals to navigate. Understanding the way taxes are calculated and liabilities are assessed matters a lot when personal saving for retirement and education, and much of the government's social policy apparatus, are closely integrated with the tax system. This study uses a survey to measure individuals' knowledge about basic elements of the personal income tax, their perception of their own tax knowledge, and their tax-filing behaviour. One would hope that tax-literate Canadians would have a high level of knowledge of the way taxes work, and a realistic appreciation of the limits of their knowledge, and thus that they could make informed decisions, for example, when filing their tax returns. The survey data show that Canadians have good knowledge of basic tax facts but struggle when asked more complex questions regarding the progressivity of the income tax. Results were generally consistent across provinces with the notable exception of respondents in Quebec, who had higher marks on the authors' tax quiz but lower self-assessed tax knowledge. The measurement instrument employed in the study will allow for a refinement of research exploring the drivers of tax compliance as well as political attitudes toward taxes and redistribution.

Keywords: Personal income taxes; self-assessment; surveys; behaviour; filing; financial management (search for similar items in EconPapers)
Date: 2020
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DOI: 10.32721/ctj.2020.68.4.pham

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