Persuading people to pay on time

Background

For years, Her Majesty’s Revenue & Customs (HMRC) had faced a problem. Lots of British citizens were not paying their taxes on time. HMRC officials had tried everything from sending letters to the late payers, threatening to charge late fees and interest amounts, and even giving warnings of legal action to get people to pay. When these efforts were of no avail, they turned to persuasion experts INFLUENCE AT WORK for help.

What We Did

We conducted an experiment with a different approach. We applied different persuasion techniques to the tax letters and measured the responses. The strongest result came from a relatable social norm: “9 out of 10 people pay their tax on time. You are in the very small minority of people who have not paid us yet.”

Outcome

For absolutely no additional cost, we measured an additional £230 million in cash to bank revenue, as calculated by the National Audit Office. This work featured as a lead article in the Harvard Business Review.

Client
HM Revenue & Customs
Service
Consultancy

"This work has become one of the most talked about and cited behavioural nudges in the world."