View about consumption tax and grandchildren

TL;DR

This study investigates how having grandchildren influences older people's support for increasing consumption tax in Japan, revealing intergenerational altruism especially towards granddaughters.

Contribution

It provides empirical evidence linking grandchildren presence to support for consumption tax increases, highlighting gender differences in intergenerational altruism.

Findings

Grandchildren positively influence support for tax increase.

Support is stronger for granddaughters than grandsons.

Older people show intergenerational altruism, especially towards granddaughters.

Abstract

In Japan, the increase in the consumption tax rate, a measure of balanced public finance, reduces the inequality of fiscal burden between the present and future generations. This study estimates the effect of grandchildren on an older person's view of consumption tax, using independently collected data. The results show that having grandchildren is positively associated with supporting an increase in consumption tax. Further, this association is observed strongly between granddaughters and grandparents. However, the association between grandsons and grandparents depends on the sub-sample. This implies that people of the old generation are likely to accept the tax burden to reduce the burden on their grandchildren, especially granddaughters. In other words, grandparents show intergenerational altruism.