34 Pages Posted: 27 Mar 2014 Last revised: 19 Aug 2018

Date Written: March 26, 2014

Abstract

We report results from a survey experiment aimed at testing whether providing information on the national public expenditure to the taxpayers and whether involving them in the process of allocating tax revenues over public goods influence the level of the adequate tax rate - the fraction of income that individuals consider adequate to pay as taxes. We find that providing information on public expenditure does not influence the level of the adequate tax rate. On the contrary, the level of the adequate tax rate substantially increases when taxpayers can get to choose the public goods to finance through their taxation.