Tax Morale and Tax Resistance: Evidence from an Internet Survey in Japan

57 Pages·2022·1.365 MB·English

by  omomi Miyazaki, Masayuki Tamaoka, Ayu Tomita, Keigo Kameda, Akihiro Kawase, Katsuyoshi Nakazawa, Hiroyuki Ono, Naoko Yokoyama

SPRINGER BRIEFS IN ECONOMICS
KOBE UNIVERSITY SOCIAL SCIENCE RESEARCH SERIES
Tomomi Miyazaki · Masayuki Tamaoka ·
Ayu Tomita · Keigo Kameda ·
Akihiro Kawase · Katsuyoshi Nakazawa ·
Hiroyuki Ono · Naoko Yokoyama
Tax Morale and
Tax Resistance
Evidence
from an Internet
Survey in Japan
SpringerBriefs in Economics
Kobe University Social Science Research Series
SeriesEditors
YunfangHu,KobeUniversityGraduateSchoolofEconomics,Kobe,Japan
ShigeyukiHamori,KobeUniversityGraduateSchoolofEconomics,Kobe,Japan
EditorialBoard
MasahiroEnomoto,KobeUniversityRIEB,Kobe,Japan
YoshihideFujioka,KobeUniversityGraduateSchoolofEconomics,Kobe,Japan
YukaKaneko,KobeUniversityCenterforSocialSystemsInnovation,Kobe,
Hyogo,Japan
KazumiSuzuki,KobeUniversityGraduateSchoolofBusinessAdministration,
Kobe,Japan
KenjiYamamoto,KobeUniversityGraduateSchoolofLaw,Kobe,Japan
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· ·
Tomomi Miyazaki Masayuki Tamaoka
· · ·
Ayu Tomita Keigo Kameda Akihiro Kawase
· ·
Katsuyoshi Nakazawa Hiroyuki Ono
Naoko Yokoyama
Tax Morale and Tax
Resistance
Evidence from an Internet Survey in Japan
TomomiMiyazaki MasayukiTamaoka
GraduateSchoolofEconomics GraduateSchoolofEconomics
KobeUniversity KobeUniversity
Kobe,Hyogo,Japan Kobe,Hyogo,Japan
AyuTomita KeigoKameda
GraduateSchoolofEconomics SchoolofPolicyStudies
KobeUniversity KwanseiGakuinUniversity
Kobe,Hyogo,Japan Sanda,Hyogo,Japan
AkihiroKawase KatsuyoshiNakazawa
FacultyofEconomics FacultyofEconomics
ToyoUniversity ToyoUniversity
Bunkyo-ku,Tokyo,Japan Bunkyo-ku,Tokyo,Japan
HiroyukiOno NaokoYokoyama
FacultyofEconomics FacultyofEconomics
ToyoUniversity OsakaSangyoUniversity
Bunkyo-ku,Tokyo,Japan Daito,Osaka,Japan
ISSN2191-5504 ISSN2191-5512 (electronic)
SpringerBriefsinEconomics
ISSN2520-1697 ISSN2520-1700 (electronic)
KobeUniversitySocialScienceResearchSeries
ISBN978-981-19-0477-6 ISBN978-981-19-0478-3 (eBook)
https://doi.org/10.1007/978-981-19-0478-3
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Preface
TaxpayersinJapanareoftendescribedasbeingveryresistanttotaxincreases,espe-
cially consumption tax increases. Indeed, the former Prime Minister, Masayoshi
Ohira, who first mentioned the necessity for taxes on a broad range of consump-
tiongoods,lostthesnapgeneralelection.Meanwhile,thecabinetofformerprime
minister, Sosuke Uno, lost the Upper House election right after introducing the
consumptiontax—thiswasthefirsttimethatoppositionpartieswonthemajorityof
theUpperHousesincethefoundationoftheLiberalDemocraticParty.Thesefacts
indicatethattaxresistance(i.e.,asperSchmölders’s[1965]definition,psychological
resistancetotaxpayment)maybestronginJapan.
Although many studies on consumption tax have been done in Japan, attention
hasrecentlymovedtothetopicssuchasconsumerpsychology,taxconsciousness,
tax morale, etc. For example, when it comes to consumer psychology, Ishida and
Nakazono(2020)examinedthe“salienteffects”ofChettyetal.(2009)byfocusing
on the total amount display system, which requires prices to include consumption
tax.Regardingtaxmorale,theWorldValueSurvey(WVS),afamousattitudeques-
tionnaireconductedaroundtheglobe,reportsthatJapanesecitizensdemonstratea
hightaxmorale.
The previous information suggests that while taxpayers in Japan resist tax
increases,theirnon-pecuniarymotivationfortaxcomplianceishigh.Althoughthese
are established facts about taxpayers in Japan, to the best of our knowledge, few
attitudequestionnairesforJapanesecitizenssimultaneouslyfocusontaxhikesand
tax compliance. Therefore, as parts of a project supported by a Grant-in-Aid for
ScientificResearch,weconductedtwosurveysin2019and2020toexaminethetwo
aforementionedestablishedfactsandrelatedtopicsamongtaxpayersinJapan.
Thisbookprovidesbackgroundinformationandbasicdescriptivestatisticsfrom
our Internet surveys in Japan. The first survey was implemented in August 2019.
Weconductedafollow-upsurveyin2020tocheckforchangesinopinionafterthe
consumptiontaxhikeinOctober2019.Thesetwosurveysaddressimportanttopics
on tax and fiscal policies, such as tax morale and tax compliance, opinions on the
JapaneseconsumptiontaxhikeinOctober2019andtheeffectsofdebtaccumulation
onconsumption.
v
vi Preface
We strived to address some of the problems inherent to the Internet survey.
The first concern regards representativeness. We confirmed the representativeness
of residential areas and household structure using the National Census. Moreover,
allrespondentswererandomlychosen.
Inthisbook,wefocusontaxmoraleandtheconsumptiontaxhike.Thesummary
statisticsindicatethattaxmoraleishighinJapan,whichisconsistentwiththeWVS.
However,halfofthefirstsurveyrespondentsopposedtheconsumptiontaxhikefrom
8%to10%.Further,about60%ofrespondentsstatedthattheir“ideal”consumption
taxrateislessthan10%.Weconfirmedthisinthesecondsurvey,whichdidnotgive
somerespondentsinformationonthesizeofgovernmentdebtoutstanding.
The correlation matrix for the relevant questions reveals an insignificant rela-
tionship between tax morale and the indicators regarding trust in politicians and
government. What is more, we found a slightly positive relationship between tax
moraleandsocialnormsorasenseofsin.Thus,thesourceofthehightaxmoraleof
theJapanesepeoplecanpartlybeexplainedbytheirmotivationtoabidebyrulesor
socialnorms.
Regardingtaxresistance,wefoundaslightlynegativerelationshipbetweenresis-
tancetotheconsumptiontaxhikeandtrustingovernment.Thisimpliesthatpolitical
distrustmaycultivateresistancetofurthertaxhikes.
We realize the necessity for further econometric exercises. As an overture to
further studies, this book introduces all our questionnaires and provides a brief
outlookforthesurvey.
Kobe,Japan TomomiMiyazaki
Kobe,Japan MasayukiTamaoka
Kobe,Japan AyuTomita
Sanda,Japan KeigoKameda
Bunkyo-ku,Japan AkihiroKawase
Bunkyo-ku,Japan KatsuyoshiNakazawa
Bunkyo-ku,Japan HiroyukiOno
Daito,Japan NaokoYokoyama
Acknowledgments Someanalysesinthisbookarebasedon“ConsumptionTaxHike,TaxMorale,
andTaxResistance:TaxpayerParadoxinJapan,”publishedinthePublicChoiceStudiesNo.73.
Theauthorsaregratefultoananonymousreferee,NobuoAkai,YoshihideFujioka,JunyaHamaaki,
MasayoshiHayashi,BerndHayo,TakayukiNago,HaruoKondoh,KazuakiSato,MasaakiSuzuki,
Takashi Shimuzu, Kentaro Tachi, Toshiyuki Uemura and Kazufumi Yugami for their insightful
comments and suggestions. This work was financially supported by the Japan Society for the
Promotion of Science (Grant-in-Aid for Scientific Research #16H03637 and #18H00868). The
usualdisclaimerapplies.
Preface vii
References
ChettyR,LooneyA,KroftK(2009)Salienceandtaxation:theoryandevidence.AmEconRev
99(4):1145–1177
IshidaS,NakazonoY(2020)Thesalienteffect:evidencefromtheconsumptiontaxhikeinJapan.
ApaperpresentedattheJapaneseEconomicAssociation2020SpringMeeting
SchmöldersG(1965)Finanzpolitik,ZwiteAuflage,Springer-Verlag
Contents
1 Introduction .................................................... 1
2 ABriefLookatJapan’sOctober2019ConsumptionTaxHike ....... 3
2.1 OverviewofJapan’sConsumptionTaxSystem .................. 3
2.2 BackgroundoftheConsumptionTaxHike ...................... 4
References ...................................................... 7
3 SurveyDesign ................................................... 9
3.1 The Attitude of the Japanese People Toward Tax Policy
andSurveyDesign ........................................... 9
3.2 OutlineoftheFirstSurvey .................................... 10
3.3 OutlineoftheSecondSurvey ................................. 11
3.4 LimitingRespondentsandCheckingRepresentativeness .......... 12
Appendix ....................................................... 17
References ...................................................... 17
4 SummaryStatistics .............................................. 19
4.1 TaxMoraleandTaxCompliance ............................... 19
4.2 TaxResistance .............................................. 24
4.3 ObservationfromtheCorrelationMatrix ........................ 28
References ...................................................... 29
5 Conclusion ..................................................... 31
Reference ....................................................... 32
AppendixA:EachItemoftheFirstSurvey ........................... 33
AppendixB:EachItemoftheSecondSurvey ......................... 43
ix
Chapter 1
Introduction
Thisbookprovidesbackgroundinformationandbasicdescriptivestatisticsfromour
InternetsurveysinJapan.ThesurveyswereimplementedinAugust2019andJuly
2020aspartsofaprojectsupportedbyaGrant-in-AidforScientificResearch.These
twosurveysaddressimportanttopicsontaxandfiscalpolicies,suchastaxmorale
andtaxcompliance,opinionsontheJapaneseconsumptiontaxhikeinOctober2019,
andtheeffectsofdebtaccumulationonconsumption,etc.
Thisstudyreportsresultsrelatedtotaxmoraleandopinionsontheconsumption
taxhike.ThesummarystatisticsindicatethatwhiletaxmoraleishighinJapan,half
oftherespondentsopposetheconsumptiontaxhikefrom8to10%.Furthermore,the
“ideal”consumptiontaxrateformostwaslessthan10%inbothsurveys,suggesting
thatJapanesetaxpayersareveryresistanttotaxpayment.Althoughthecorrelation
between some answers is weak, the source of tax resistance can be attributed to
distrustofpoliticiansandthecentralgovernment.
Theremainderofthispaperisorganizedasfollows.Chapter2providestheback-
ground information on the Japanese consumption tax hike in October 2019 and
relatedpolicies.Chapter3presentsthesurveydesign.Chapter4reportspartsofthe
summarystatisticsontaxmorale,taxcompliance,andattitudetowardconsumption
taxhikes.Chapter5concludesthestudy.
©TheAuthor(s),underexclusivelicensetoSpringerNatureSingaporePteLtd.2022 1
T.Miyazakietal.,TaxMoraleandTaxResistance,KobeUniversitySocialScience
ResearchSeries,https://doi.org/10.1007/978-981-19-0478-3_1