Public trust in tax: surveying public trust in G20 tax systems

This third edition of the Public Trust in Tax study comes at a time when governments and citizens all over the world are re-evaluating their priorities as we live through one of the biggest shocks to society and economies in living memory.

These surveys reflect the views of over 8,000 people across the G20 countries plus New Zealand - providing a real  insight into who they trust and what concerns them – and providing a view of what the public – in other words, taxpayers and voters – actually think. Around two-thirds of the world's population live in the G20 countries. They account for 85% of the Gross World Product and for 75% of the world trade.

The report also includes the findings of joint regional roundtables bringing together policy-makers and standard-setters, business representatives, NGOs and academics, looking at the issues from an international policy perspective,  as well as talking to experts from outside the G20, in Africa and Asia.

What we found

As governments seek to cope with the impact of COVID19, 65.6% of respondents believe it would be appropriate/very appropriate for governments to offer tax incentives to key sectors impacted by COVID.

Other areas where incentives might be offered all saw a fall in popularity with respondents this year, with the exception of film and arts projects., perhaps reflecting the extent to which the sector has been hit by the COVID19 crisis.

Public trust in the actors who will be involved in delivering and communicating those changes has improved across the board since 2019. However, trust in politicians remains low, with an overall net score of 22% distrust from respondents.

Tax authorities, another key element in tax reforms, fare better with a net positive trust rating of 15%. However, this masks a highly polarised population, with 43% of respondents trusting or highly trusting their tax authority while 28% distrust or highly distrust the authorities.

However, trust in professional accountants and tax lawyers remains high, with the net balance reporting trust in accounts at 41% in 2021, up from 38% in 2018. Accountants will have a vital role to play in helping to shape the changes needed, and in explaining them to the public.

Perhaps surprisingly in view of the historic global agreement in July endorsed by G20 Finance Ministers and Central Bank Governors, which aims to bring fairness and stability to the international corporate tax framework, support for international collaboration has fallen since 2018 in 15 of the countries surveyed.

In another interesting and perhaps unexpected development, the percentage of respondents believing that multinational business should have to publicly disclose country by country tax information has fallen from 44% to 39%, while the percentage, believing that the information should be shared only with tax authorities has risen from 41% to 46%.

This is against a backdrop of a majority of respondents in seven countries believing that multinationals do not pay a reasonable amount of tax in their country. Even in these countries a majority also felt it remains important for their government to offer tax incentives to attract multinational business, a position supported in all of the countries surveyed.

One common theme from survey respondents’ comments and our roundtable participants was the importance of financial literacy and education about what the tax system is for, and how it works.

Trust in tax systems has been positively linked with higher education and wealth levels in recent OECD research, and as society looks to build together for a new future, the importance of bringing informed voices to the debate on how best to develop tax systems cannot be overstated.

Key findings

Trust in all stakeholders has improved, on balance, but there are still significant variations between regions

• People continue to have the highest level of trust in professional tax accountants (55% trust/ highly trust), professional tax lawyers (50%), and non-government organisations (37%) in relation to the tax system.
• Most people believe the role of professional accountants contributes to improving tax systems by making them more efficient (58%), more effective (56%), and fairer (53%).
• Across the G20 countries, 48% of the population are satisfied with the ease and efficiency of their dealings with tax authorities, a one-point fall from 2018.
• People want to see tax systems used to target specific positive outcomes
• People strongly support the use of tax incentives to support sectors affected by COVID (66%).
• ·Support for incentives to target ‘global megatrends’ such as climate change and the ageing population remains high.
• In addition, 49% of people support the use of tax incentives to attract multinational business.
• People generally think that taxpayers are paying enough tax
• Across the entire sample, respondents were more likely to agree than disagree that taxpayer groups were paying a reasonable amount of tax. This applied to all the groups considered, encompassing average- or low-income individuals, high-income individuals, local companies and multinational companies.
• People stated that local companies were most likely to be paying a reasonable amount of tax (33% agreed across the whole survey).
• In Argentina, Russia, France and South Africa, respondents claimed that average or low-income individuals do not pay a reasonable amount of tax. A number of respondents indicated in their further comments that they considered the tax burden on the lowest wealth group to be too high.
• Conversely, a number of comments highlighted the perceived injustice of higher-income individuals paying less tax. Fewer than one in four respondents across the G20 stated that high income individuals pay a reasonable amount of tax in their country.