Income Tax Versus Value Added Tax: A Mixed-Methods Comparison of Social Representations

Jerome Olsen, Christoph Kogler, Jennifer Stark, Erich Kirchler


To date, tax research has strongly focused on income tax compliance. Meanwhile, a large proportion of tax revenue is raised by consumption taxes, such as value added tax (VAT). This study compared the respective social representations of income tax and VAT by employed and self-employed taxpayers. The aim was to gain an understanding of similarities and differences in the overall quantitative evaluation and qualitative content of the two taxes. For this purpose, we administered a free association task to employed (n = 140) and self-employed (n = 349) Austrian taxpayers with the stimuli income tax and VAT (between-subject design). Moreover, we measured emotional reactions and knowledge referring to the two types of taxes as well as individuals’ mental accounting practices. Our results revealed that both taxes were evaluated negatively overall, although they did not differ from each other in their quantitative evaluation. Regarding employment status, self-employed taxpayers generated a larger number of negative associations, had higher knowledge, and expressed more negative emotions than employed taxpayers. The qualitative analysis also revealed that the social representations were specific to the two taxes. We conclude that findings from income tax research cannot be directly translated to the context of VAT.

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