The Role Of Tax-Free Investment Opportunities In Household Financial Decisions: Real-World Implications Of Tax-Exempt Hungarian Government Securities

Our analysis examines whether tax knowledge impacts investment decisions. Using representative survey data of the Hungarian population from 2022, we investigate whether the decision maker's knowledge of the interest tax exemption on government securities impacts investment decisions. Our research shows that tax awareness plays a decisive role in the ownership of certain financial instruments, most notably for government securities. On the other hand, there are various other investment assets for which the tax knowledge does not play a role.