Voter reaction to tax change: the case of the poll tax

The introduction of the poll tax has furnished a rare opportunity of providing some British evidence of the differences in voter reaction to tax change at a much more disaggregated level than hitherto. The opportunity arises because of the availibility of data on the changes in average local tax bills in the switch from the domestic rates (property tax) to the poll tax for each of the 39 electoral districts in the City of Birmingham. Local elections took place within one month of the introduction of the new tax in May 1990. The data are used to estimate differential reaction to the tax change by the voters in the electoral districts. The estimates throw light on both the different interpretations of the failure of the poll tax and the broader controversy regarding the question of whether voters are motivated primarily by self-interest or by the wider public interest.