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Behavioral Interventions in Tax Compliance : Evidence from Guatemala
- Publication Year :
- 2016
- Publisher :
- World Bank, Washington, DC, 2016.
-
Abstract
- This paper presents results from a large (43,387) nationwide randomized controlled trial in Guatemala that used reminders to promote tax compliance. The trial varied the letter received by taxpayers (individuals and firms) who had failed to pay their income tax for the 2013 tax year. Taxpayers were randomly allocated to receive either no letter, the letter originally used by the Guatemalan Tax Authority, or four letter variants adapted using behavioral design. The study finds that although all letters increased the rate of declaration, only two of the letters were successful at increasing the rate of payment and the average amount paid per letter received. The best performing treatments were a deterrent message framing non-declaration as an intentional and deliberate choice, rather than oversight (designed to overcome status quo bias), and a social norms message that referred to the 64.5 percent of taxpayers that had already paid this tax (join the status quo). These two interventions increased the rate of payment as well as the average amount paid conditional on paying, overall more than tripling tax receipts. The paper estimates that if sent to all taxpayers in the sample, in 11 weeks the social norms letter would have generated additional tax revenues of approximately US$760,000, which is 36 times the cost of sending the letters. The effects are persistent and remain at 12 month follow up, suggesting the letters are effective in increasing revenue for the tax authority rather than just bringing tax receipts forward.
- Subjects :
- COMMUNICATIONS
TAX COMPLIANCE
INVESTMENT
TAX
INVENTORY
DEVELOPING COUNTRY
COMMUNICATION
GROSS DOMESTIC PRODUCT
TAX RECEIPTS
FISCAL MANAGEMENT
INCOME
TAX AUTHORITIES
MIDDLE-INCOME COUNTRY
TAXPAYER
TAX RETURN
WORLD DEVELOPMENT INDICATORS
RETURNS
POVERTY
SHARES
ADDED TAX
GOODS
TAX COLLECTION
ACCOUNTING STANDARDS
TAX AVOIDANCE
TAX DEBT
TAX LIABILITY
INTERNAL REVENUE
DEMOCRACY
TAX REFORM
MARKETS
TAX STRUCTURE
PROFIT
FINANCE
INFORMAL ECONOMY
TAX REVENUE
TAX POLICY
REPUTATION
VALUE ADDED TAX
SMALL BUSINESS
DEBT
TRADE
CORPORATE TAX
FISCAL
TAX RETURNS
GOVERNMENT POLICIES
SUSTAINABLE DEVELOPMENT
PROPERTY
TRUST
COMPETITIVE MARKETS
BUSINESS TAX
RETURN
TAX RATE
ENFORCEMENT
TAXPAYER COMPLIANCE
MONETARY PAYOFF
TAX REGIMES
CREDIBILITY
TAX REGIME
PROPERTY TAXES
TAXPAYERS
EXCHANGE
ACCOUNTING
TAXATION
FINANCES
HUMAN DEVELOPMENT
PUBLIC ECONOMICS
GOVERNMENT REVENUES
INCOME TAX
PROPERTY TAX
DEDUCTIONS
LIABILITY
ASSESSMENT
EXCHANGE RATE
GOOD
REVENUE
TAXES
GOVERNMENT REVENUE
DEFAULT
GOVERNMENT SPENDING
OPTION
PUBLIC POLICY
PROFITS
TAX REVENUES
EXPENDITURES
PUBLIC FINANCE
DEVELOPING COUNTRIES
INTERNATIONAL BANK
TAX LEGISLATION
FUTURE
MIDDLE-INCOME COUNTRIES
MONETARY FUND
DEVELOPMENT BANK
ACCOUNTANT
INTEREST
PUBLIC GOODS
REVENUES
TAX AUDIT
CHECKS
TAX REGULATIONS
AUDIT
TAX EVASION
Subjects
Details
- Language :
- English
- Database :
- OpenAIRE
- Accession number :
- edsair.od......2456..9bd65fa9008c5b919de3c25a574ee443