Behavioral insights and tax compliance: Experimental evidence from Belgium

Last registered on August 31, 2015

Pre-Trial

Trial Information

General Information

Title
Behavioral insights and tax compliance: Experimental evidence from Belgium
RCT ID
AEARCTR-0000827
Initial registration date
August 31, 2015

Initial registration date is when the trial was registered.

It corresponds to when the registration was submitted to the Registry to be reviewed for publication.

First published
August 31, 2015, 2:31 PM EDT

First published corresponds to when the trial was first made public on the Registry after being reviewed.

Locations

Region

Primary Investigator

Affiliation
University of Oxford

Other Primary Investigator(s)

PI Affiliation
London School of Economics

Additional Trial Information

Status
In development
Start date
2015-09-01
End date
2016-09-01
Secondary IDs
Abstract
We aim to study the effect of nudges in reminder letters at two different stages of the tax cycle. In collaboration with the Ministry of Finance of Belgium, we are designing an RCT on Belgian taxpayers that are either late with their tax payment or that have not filed their tax return. For the trial on the late payment reminder we will circulate 8 treatment letters in addition to the current control letter. These treatment letters introduce the following nudges: (1) simplification; (2) social norm; (3) public goods (positively framed); (4) public goods (negatively framed); (5) social norm + public goods; (6) active choice; (7) explicit penalty; and (8) active choice + explicit penalty. For the trial on the late filing reminder the following 3 treatment letters will be circulated in addition to a simplified control letter: (1) social norm; (2) public goods; (3) social norm + public goods. The nudges that we introduce in these reminder letters are grounded in behavioral insights such as loss aversion (positive vs. negatively framed public goods letters), social preferences (social norm letter), and status quo bias (active choice letter). We aim to treat the universe of late tax filers and late taxpayers in Belgium. The last two digits of the national identity number will be used to randomly assign treatment letters across the population. All treatment and control groups have equal size (in terms of number of letters sent out). The outcome variables will include tax payments, timing of payment, and number of filers and we will analyse heterogeneous treatment effects across taxpayers with different characteristics including gender, income, age, job status (employee or self-employed), region, online or paper filing. We also aim to convince the tax administration to send out new letters in a second year in order (1) to further validate the heterogeneous treatment effects using the first-year results to determine the random allocation to treatment and (2) to evaluate the persistence of the treatment effects.
External Link(s)

Registration Citation

Citation
De Neve, Jan-Emmanuel and Johannes Spinnewijn. 2015. "Behavioral insights and tax compliance: Experimental evidence from Belgium." AEA RCT Registry. August 31. https://doi.org/10.1257/rct.827-1.0
Former Citation
De Neve, Jan-Emmanuel and Johannes Spinnewijn. 2015. "Behavioral insights and tax compliance: Experimental evidence from Belgium." AEA RCT Registry. August 31. https://www.socialscienceregistry.org/trials/827/history/5144
Experimental Details

Interventions

Intervention(s)
Intervention Start Date
2015-09-01
Intervention End Date
2016-09-01

Primary Outcomes

Primary Outcomes (end points)
The outcome variables will include tax payments, timing of payment, and number of filers and we will analyse heterogeneous treatment effects across taxpayers with different characteristics including gender, income, age, job status (employee or self-employed), region, online or paper filing. We also aim to convince the tax administration to send out new letters in a second year in order (1) to further validate the heterogeneous treatment effects using the first-year results to determine the random allocation to treatment and (2) to evaluate the persistence of the treatment effects.
Primary Outcomes (explanation)

Secondary Outcomes

Secondary Outcomes (end points)
Secondary Outcomes (explanation)

Experimental Design

Experimental Design
We aim to study the effect of nudges in reminder letters at two different stages of the tax cycle. In collaboration with the Ministry of Finance of Belgium, we are designing an RCT on Belgian taxpayers that are either late with their tax payment or that have not filed their tax return. For the trial on the late payment reminder we will circulate 8 different treatment letters in addition to the current control letter. These treatment letters introduce the following nudges: (1) simplification; (2) social norm; (3) public goods (positively framed); (4) public goods (negatively framed); (5) social norm + public goods; (6) active choice; (7) explicit penalty; and (8) active choice + explicit penalty. For the trial on the late filing reminder the following 3 treatment letters will be circulated in addition to a simplified control letter: (1) social norm; (2) public goods; (3) social norm + public goods.
Experimental Design Details
Randomization Method
The last two digits of the national identity number will be used to randomly assign treatment letters across the population. All treatment and control groups have equal size (in terms of number of letters sent out).
Randomization Unit
Individual taxpayers.
Was the treatment clustered?
No

Experiment Characteristics

Sample size: planned number of clusters
0
Sample size: planned number of observations
We aim to treat the universe of late tax filers and late taxpayers in Belgium.
Sample size (or number of clusters) by treatment arms
Our partners at the Ministry of Finance have indicated that the number of observations per treatment arm would be approximately 50,000 individuals.
Minimum detectable effect size for main outcomes (accounting for sample design and clustering)
IRB

Institutional Review Boards (IRBs)

IRB Name
IRB Approval Date
IRB Approval Number

Post-Trial

Post Trial Information

Study Withdrawal

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Intervention

Is the intervention completed?
No
Data Collection Complete
Data Publication

Data Publication

Is public data available?
No

Program Files

Program Files
Reports, Papers & Other Materials

Relevant Paper(s)

Reports & Other Materials