My Taxes Are Too Darn High: Why Do Households Protest Their Taxes?

165 Pages Posted: 2 Nov 2020 Last revised: 27 May 2022

See all articles by Brad Nathan

Brad Nathan

Columbia University

Ricardo Perez-Truglia

University of California, Berkeley; National Bureau of Economic Research (NBER)

Alejandro Zentner

The University of Texas at Dallas - Naveen Jindal School of Management

Multiple version iconThere are 2 versions of this paper

Date Written: September 12, 2020

Abstract

In the United States and many other countries, taxpayers can file a protest to legally reduce their property taxes. While tax protests can provide a unique opportunity to study the (un)willingness to pay taxes, they have received little attention from researchers. To fill that gap, we study what motivates households to protest their property taxes. Using a field experiment, we show that filing frictions and fairness considerations play significant roles. In comparison, partisan identity plays a minor role. We calculate the magnitude of filing frictions and willingness to pay for fairness using a money metric. To do so, we combine our experimental estimates with quasi-experimental evidence on the role of expected tax savings. Last, we discuss how low-cost interventions targeted at disadvantaged groups can mitigate existing economic and racial disparities in the system of tax appeals.

Keywords: taxes, protest, appeal, preferences for redistribution, conditional cooperation

JEL Classification: C93, H26, K34, K42, Z13

Suggested Citation

Nathan, Brad and Perez-Truglia, Ricardo and Zentner, Alejandro, My Taxes Are Too Darn High: Why Do Households Protest Their Taxes? (September 12, 2020). Available at SSRN: https://ssrn.com/abstract=3691361 or http://dx.doi.org/10.2139/ssrn.3691361

Brad Nathan

Columbia University ( email )

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New York, NY 10027
United States

HOME PAGE: http://www.brad-nathan.com

Ricardo Perez-Truglia (Contact Author)

University of California, Berkeley ( email )

310 Barrows Hall
Berkeley, CA 94720
United States

National Bureau of Economic Research (NBER) ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
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Alejandro Zentner

The University of Texas at Dallas - Naveen Jindal School of Management ( email )

P.O. Box 830688
Richardson, TX 75083-0688
United States

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