No. 2026-16 - Wealth inequality and preferences in the design of a Wealth Tax: An information-provision experiment in the UK and Spain

Abstract:

We study perceptions of wealth inequality and preferences over the design of a wealth tax through representative online survey experiments in the United Kingdom and Spain (2023). After eliciting prior beliefs about the wealth distribution, we randomly expose respondents to true distributional statistics and measure the effects on support for a wealth tax and on its preferred design: threshold, rate and asset base. Baseline support is high and stable (over 80% in both countries), the modal preferred threshold is £/€1 million or more, a low (0.5%) rate is more acceptable than a high (1.5%) one, and respondents protect primary residences in both countries and pension wealth in the UK. The average treatment effect on support, threshold and rate is close to zero in both countries, reflecting a high-support ceiling and a weak link between perceived inequality and tax preferences. On average, respondents who correct their misperceptions update their view of inequality but not their support, a clear belief-to-preference dissociation. Information campaigns may shift beliefs about inequality but appear unlikely to broaden an already high overall support for wealth taxation. An analysis of subgroups by world-views reveals that information can move preferences about the exemption threshold -where the ceiling does not bind- and only in some Spanish groups: supporters who regard inequality as unfair and trust that taxation is useful and well spent.