A Behavioral Approach to the Collection of Overdue Motor Vehicle Tax
DOI:
https://doi.org/10.1234/laj.v15i1.253211Keywords:
Overdue tax collection, Behavioral approach, Motor Vehicle taxes, Experimental researchAbstract
This research employs a behavioral approach to studying the collection of overdue motor vehicle tax. The amount of unpaid taxes was worth 6.2 billion Thai baht in June 2019. This represents huge opportunity losses for local governments and brings about tax inequality between those who pay taxes and those who do not. Data from five sub-districts in Krabi Province was the focal point in this study. A nudge approach was applied to the five types of overdue tax-reminder letters. Overall, the nudge letters helped increase the tax payment rate by about 10.48%. Yet, the benefit-based nudge letter and the social norm message caused the higher rates than the base figure by 12.67 percent to 13.07 percent, respectively. The findings suggest that the behavioral approach is an intriguing alternative for the enhancement of local revenues and the related tax authority should pay closer attention to the collection of overdue motor vehicle tax. This may result in increased tax revenues for wider local public services and more equitable tax administration practices.
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