American taxpayers frightened by fees, continue resistance for second
year of Ipsos-Insight survey
NEW YORK, NY, April 6 /PRNewswire/ - American taxpayers are still
hesitant to embrace the option to pay Uncle Sam with their credit cards,
according to a study of 1,001 American adults conducted by leading market
research firm Ipsos-Insight. The study revealed for the second year that
while 62% of American adults are aware that the Internal Revenue Service
accepts credit cards, a paltry 1% plan to use a credit card to pay incremental
Federal income taxes for 2004. "As was apparent in previous years, a large
convenience charge aimed directly at the consumer is clearly the barrier to
broader use of this service," said Doug Cottings, Senior Vice President with
Ipsos-Insight's Financial Services practice.
Depending on the service provider, a credit card convenience fee of
anywhere from 2.25% to 3% is charged to the taxpayer when paying federal taxes
by credit card. The Taxpayer Relief Act of 1997 authorized the Treasury to
accept credit card payments for federal taxes but prohibits the IRS from
paying the standard credit card transaction fees merchants usually pay credit
card companies to process their transactions. The convenience fee acts as a
necessary revenue stream and is split between the service provider and the
credit card company in exchange for the time it takes them to handle and
process these transactions.
According to the study, Americans are extremely resistant to paying the
convenience fees. Three out of four (75%) say they "definitely will not" use a
credit card the next time they owe incremental Federal income taxes. Instead,
they will resort to the usual personal check (70%), money order (3%) or direct
debit from a bank account (15%).
The study reveals that if the service were free, 21% of those open to the
concept would use it, down from 34% last year. This sends the signal that the
convenience and loyalty benefits of using a credit card are appealing, just
not for a premium.
To peruse the full release, with charts, go to:
http://www.ipsos-na.com/news/pressrelease.cfm?id=2616
For more information, please contact:
Doug Cottings
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Senior Vice President
Ipsos-Insight, Financial Services
(336) 668-8340
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SOURCE Ipsos; Ipsos-Insight
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CONTACT:
Doug Cottings, Senior Vice President,
Ipsos-Insight, Financial Services, (336) 668-8340
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