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Using behavioural insights in tax authorities’ reminder letters

  • Projects and activities | Last updated: 12 Dec 2023
Behavioural Insights

Brief me

Context

Late payment of taxes is a serious issue for governments. Imposing penalties on late payers is one typical response – but the way in which public authorities draft reminder letters also matters.

Goals

The project aims to test the impact of alternative reminder letters on tax compliance.

Specifically, it compares the results obtained by reminder letters sent in previous years to taxpayers with overdue personal income tax liability, with the results obtained by letters which have:

  • different structure – such as simpler text, less unnecessary information and the requested action placed more prominently
  • different messages – such as saying the authorities will monitor recipients’ response to the letter ("We will be monitoring your response") or telling them that not responding to the letter will be considered an active choice ("Previously, we treated your lack of response as an oversight. Now, if you don’t act, we will treat this as an active choice”)

Methods

We are conducting a field experiment (a ‘randomised controlled trial’) – real taxpayers receive one of the 9 different versions of reminder letters and we observe their actual tax compliance.

Expected outcomes

Results are expected to inform tax authorities in various EU countries about the most efficient messages for increasing payment of tax owed.

More information and links
Coordinators
Antonios PROESTAKIS
Participants
Joana SOUSA LOURENCO
Maarten LUTS
Sara RAFAEL ALMEIDA
Geographic coverageIrelandBelgium
Originally Published | Last Updated

14 Sep 2020 | 12 Dec 2023

Knowledge service | MetadataBehavioural Insights | Behavioural insights for tax policy
Digital Europa Thesaurus (DET)tax avoidancetax system
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