Immigration and tax morale: the role of perceptions and prejudices

David Rodriguez-Justicia and Bernd Theilen ()

Empirical Economics, 2022, vol. 62, issue 4, No 11, 1832 pages

Abstract: Abstract This paper analyzes whether the belief that immigrants represent a threat to welfare sustainability relates to citizens’ willingness to pay taxes. We approach this question using individual-level data from the 4th and 5th waves of the European Values Study (EVS). We find lower levels of tax morale among citizens who believe that immigrants are a strain on the welfare system. This suggests the possibility that the belief that immigration erodes the welfare system could become a self-fulfilling prophecy. Moreover, our results reveal substantial cross-regional heterogeneity and that prejudices play a role in belief formation, issues that deserve the attention of scholars and politicians.

Keywords: Immigration; Tax morale; Tax compliance; Welfare system; Welfare state sustainability (search for similar items in EconPapers)
JEL-codes: H26 H41 I30 J15 (search for similar items in EconPapers)
Date: 2022
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DOI: 10.1007/s00181-021-02083-7

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