The Role of Misconceptions in Support for Regressive Tax Reform‪.‬

INTRODUCTION In the United States there is considerable popular support for replacing the existing income tax structure with an alternative system, such as a flat-rate tax or a retail sales tax, that almost certainly would feature a more regressive distribution of the tax burden, and for abolishing the most progressive of all federal taxes, the estate and gift tax. This paper demonstrates that a non-trivial amount of this support is based on a misconception that these changes would be progressive rather than regressive, mostly because many people believe that the distribution of the burden of the existing income tax is regressive. This finding has important policy implications in part because of recent experimental evidence in political science, including Fishkin (1997), suggesting that voter education can alter perceptions and significantly change support for policies.