Tax payment and social pressure

Bandwagon Effect and Tax
Intervention Tax

How peer pressure can drive revenues to go up

Intervention Description

The Behavioural Insights Team (BIT) of the UK government conducted a test on a randomised group of British citizens who had failed to pay their taxes. One group was given a standatd letter suggesting they pay without any social pressures. Another group was given letters reminding them of the fact that their neighbors had paid, or what the taxes would be used for. Of the social pressure reminder group, 83% paid their debts, as opposed to 67.5% of the control group. That difference would result in an estimated £30 million of extra revenue if applied nationally.


Behavioural Insights Team Annual Update 2010-11