| Title | Smart Interventions for Smart Cities: Using Behavioral Economy in Increasing Revenue from Local Fees and Why It Might Sometimes Fail |
|---|---|
| ID_Doc | 44391 |
| Authors | Muthová, NJ; Svidronová, MM; Vitálisová, K |
| Title | Smart Interventions for Smart Cities: Using Behavioral Economy in Increasing Revenue from Local Fees and Why It Might Sometimes Fail |
| Year | 2022 |
| Published | |
| Abstract | The collection of taxes and fees is one of the main functions of a modern local government, through which many public goods and services are provided. However, in many local governments, there is a need to address the problem of non-payers of local taxes or other local fees. Although taxpayers are usually sent reminders to pay local taxes or charges, or if they fail to pay, they will be referred for distrainment, there are still people who do not fulfill their obligations to the local government. Several studies have confirmed that the use of behavioral intervention can be a useful tool to reduce the proportion of non-payers, i.e., the taxpayers can be 'nudged' to pay their taxes on time and correctly. In this paper, we present the results of a behavioral intervention in the city of Banska Bystrica, Slovakia. The aim of the intervention was to increase the city's revenues from garbage disposal fees, dog fees and property tax by proactive communication - reminder (a letter) and leaflets with targeted framing. In October 2021, the city sent a total of 520 reminder letters as part of the intervention. The letters were divided into 4 groups of 130 tax subjects. The data was analyzed using Cramer's V. The results in this particular city show that the intervention did not produce the expected results; we discuss other examples of Slovak local governments that show the positive effect of behavioral interventions in the area of tax and fee collection. |
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