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Results from BIT tax trial in Guatemala

22nd Dec 2014

You might remember reading a blog post back in May that announced the launch of our first randomised controlled trials in Latin America, in partnership with the World Bank. We now have results.

The trial tested redesigned reminder letters to Guatemalan taxpayers who had failed to declare their income tax on time. We found that the behaviourally-informed letters outperformed all other conditions, with the most successful variant increasing payment by 43%.

For more details, read this excellent article about the trial, published today in the international development magazine,

The trial demonstrates the range of contexts in which behavioural approaches can work. It also adds more weight to a key tenet of BIT philosophy – that practically costless changes to existing government processes can have big impacts.

The trial, our first in a developing country, was made possible by BIT ‘spinning out’ of the UK government this year to become a social purpose company, thus allowing us to respond to requests from a broader range of public sector organisations. We hope that this will be the first of many trials in the field of international development.

The study was conducted by Stewart Kettle, Marco Hernandez (of the World Bank), Michael Sanders and Simon Ruda. It was also mentioned at the recent launch of the World Development Report 2015 on Mind, Society and Behaviour (fast forward 18 minutes to hear BIT CEO David Halpern talk about this and other BIT work).