How can we build support for taxation among the wealthy in fragile conflict-afflicted countries? Haiti, one of the poorest and most unequal societies in the Americas, is highly aid-reliant and lacks tax revenue. From a narrow self-interest perspective, the affluent should become more supportive of property taxation when the tax returns serve their own interest. However, in fragile states that struggle to provide adequate returns and where public goods can also be provided by non-state actors, we also expect broader utility-maximizing motives such as social recognition and the identity of the tax authority to critically define the affluents’ tax support. Support should increase when they receive social recognition, a non-material benefit, for their tax payment and taxes are collected and administered by entities they trust. We test our argument with a conjoint experiment of property tax-related reform proposals in an online survey collected in winter 2023/24 in Haiti, when there was an unexpected gang insurrection. Institutional failure, represented by the gang uprising, erodes the wealthy’s tax support when municipalities are the tax authority. Support for the property tax reform decreases when NGOs are involved. Importantly, the wealthy prefer tax proposals when they receive public recognition from their peer group, a low-cost instrument, and when they know the revenue will benefit the general population, rather than specific groups.
Journal Article
