Taxation As Political Insurance

Conventional explanations of democratization assume a hike in taxation following suffrage extension. As the median voter grows poorer, the preference for redistribution rises and so does taxation. This paper presents a theoretical and empirical challenge of this proposition. In particular, we argue that taxation might be utilized precisely to delay democratization. By linking political participation to individual tax obligations, conservative parties and autocratic regimes might be able to manipulate ‘effective’ enfranchisement and delay full democratic transition. We test our theory using a cross-national dataset comprising the European countries from 1815 to 1939. We show that nondemocratic governments were more likely than democracies to adopt progressive income taxes. Among democratic regimes, we find that conservative governments leaded the adoption of progressive taxation. We supplement this cross-national analysis with an analysis of the economic and political determinants of political support for the adoption of income taxes in Britain and Prussia.