The report Talking tax: how to win support for taxing wealth, published by the non-partisan thinktank Tax Justice UK, draws on new analysis by a team of researchers at SPERI led by Dr Liam Stanley. It shows that there is significant public support for taxes on wealth, with 74% of people wanting to see wealth taxed more, but that there is no common understanding amongst the public about what wealth is.
Led at SPERI by Liam Stanley – that has explored how the public make sense of tax and wealth. Through the project 11 focus groups and two major polls were conducted to better understand the views of members of the public across the UK about tax, wealth and public spending. The project – a collaboration with Tax Justice UK – was designed by drawing on important findings from Liam’s existing research on understanding tax. It received funding from the ESRC Impact Acceleration Awards via The University of Sheffield’s Internal Knowledge Exchange Scheme.
Despite there being broad support for higher taxes on wealth, SPERI analysis of the focus groups found that there is widespread confusion about different taxes on wealth such as capital gains tax, inheritance tax and pension tax relief.
Dr Liam Stanley said: “The focus groups highlight how “wealth” means different things to different people. To economists, wealth is understood as capital, asset ownership and resources like property and is distinct from income from employment. But our analysis highlights how members of the public often understood wealth in very different ways. Wealth is seen as about acquiring a sufficient level of “comfort” and isn’t so clearly distinguished from income. This matters a lot when politicians are currently discussing new taxes on wealth and for gaining public support for any new taxes on wealth”.
The report also explores how people use a “container model” to understand tax and the economy, one in which they as “taxpayers” pay into the system while “others” take resources away. This draws on Liam’s previous research about how the public understand the tax system and how such understandings can lead people to demonise other groups they regard as taking too much ‘out’.
Analysis by Liam Stanley, Tom McGrath and Tom Hunt shaped the report. The research team is now developing new analysis of the data from the project that will inform new academic publications. Liam Stanley’s previous research on tax led to the new collaboration and informed the new report. This includes:
- The 2018 SPERI report Communicating Tax (with Rebecca Bramall) which examined the government’s Annual Tax Summary – a document which provides UK taxpayers with a breakdown of how their taxes are spent – and proposed how the government could communicate differently to citizens about how it spends the tax they pay.
- An article with Todd Hartman “Tax Preferences, Fiscal Transparency, and the Meaning of Welfare: An Experimental Study” published in 2018 in Political Studies that explores the effects of the UK’s personal annual tax summaries on public attitudes to tax and spending.
- A 2016 article “Legitimacy gaps, taxpayer conflict, and the politics of austerity in the UK” in the British Journal of Politics and International Relations that reports findings from focus groups with taxpayers showing how members of the public make sense of austerity measures.
More information about the new report can be found here.