Taxing the Wealthy in Haiti: Evidence from a Survey Experiment on Property Tax Preferences

How can the wealthy become more supportive of taxation in fragile conflict-afflicted countries? Haiti, one of the poorest and most unequal societies in the Americas, is highly reliant on aid and lacks tax revenue. From a self-interest perspective, the affluent should become more supportive of taxation when the returns from it serve their own interests (taxes are earmarked, have a short discount rate, and redistribution is universal rather than pro-poor). However, in states that struggle to provide adequate returns, we also expect trust and social recognition to drive the affluent to support taxation. The affluent should be more supportive of property tax proposals when they trust the tax authorities and tax collector, and when they receive social recognition for their tax payment. We test our argument with a conjoint experiment of property tax-related reform proposals in an online survey collected in Haiti during winter 2023/24, when there was an unexpected gang insurrection.

Our study shows how gang uprisings can erode the wealthy’s trust in municipal tax administrations, making them indifferent to both local and central government when it comes to tax administration. Despite institutional failure, the affluent in Haiti support taxes being collected by bureaucrats, and in collaboration with traditional (community and religious) leaders. We also find that the affluent, compared to the average respondent, prefer tax proposals when they receive public recognition from their peer group. The wealthy are also more supportive of property taxation when they know the revenue will benefit the general population, rather than specific groups. Our findings help identify a number of cost-effective strategies that can be used to build support for property taxation in institutionally fragile conflict-ridden states.