Social proof in action: Behavioural path to better tax system

Sri Lanka’s tax system could benefit from creative social proof strategies

Human nature is fundamentally shaped by connections emotional, social, and environmental that begin at birth and persist throughout life. These connections influence how people think, grow, and make decisions, creating a deep reliance on signals from those around them. Among the most powerful of these influences is social proof the habit of observing others when deciding how to behave, especially in uncertain situations. In the context of taxation, social proof plays a crucial role in shaping individual attitudes and compliance behaviours. Understanding and using this human pattern can be a game-changer for governments seeking to strengthen voluntary tax compliance and build a culture of civic responsibility.

Why do we so often follow the crowd, even when we’re not sure what’s going on? Imagine walking through town and spotting two restaurants one nearly empty, the other buzzing with people. Most of us would pick the busy one, thinking, “They must know something I don’t.” That’s social proof in action. It’s a simple, everyday habit copying others when we’re unsure that also shows up in bigger decisions, like paying taxes. When we see people around us doing their part, it sends a quiet but powerful message: “This is what responsible citizens do.”

Recognising this tendency, many tax authorities in the globe have shifted their approach moving beyond audits and penalties to foster positive social norms that encourage people to meet their tax obligations. When people see that most of their neighbours, friends, or colleagues are paying taxes honestly and on time, they feel a stronger sense of responsibility to do the same. Social proof creates a community expectation that paying taxes is the normal and right thing to do. This approach helps build trust and cooperation between taxpayers and tax administrations. By highlighting compliance as a common behaviour, tax authorities can encourage voluntary compliance more effectively than through enforcement alone. Ultimately, this strategy supports a fairer and more sustainable tax system for everyone.

Sri Lanka’s tax system could benefit from creative social proof strategies. For instance, tax letters might include messages like, “Nine out of ten people in your community pay their taxes on time,” to normalise compliance. Certificates such as “This Business Pays Its Fair Share” could be awarded to responsible shopkeepers and displayed publicly, encouraging others to follow. Sharing real stories like that of a young entrepreneur who expanded a business with support from tax-funded government services can foster civic pride and a stronger sense of connection. Making these contributions relatable and visible helps turn tax compliance into a positive social norm. Implementing these approaches can transform tax compliance from a duty into a shared community value, ultimately enhancing cooperation and long-term revenue sustainability in Sri Lanka.

Social proof works not by shaming those who fall short, but by creating a sense of belonging around doing the right thing. The aim isn’t to blame non-compliant taxpayers, but to highlight that honesty is common, expected, and respected. When people believe that others around them are paying their taxes, they’re more likely to follow suit. This taps into our deep social need to fit in and do what’s seen as normal. Integrity, when made visible, becomes contagious. In this way, tax compliance shifts from being an isolated, personal act to a shared civic behaviour that strengthens public trust.

Social proof the natural human habit of following the behaviour of others offers more than just a messaging tool; it can be a systemwide strategy for building lasting tax compliance. When tax system integrate this principle across policy, administration, and professional practice, compliance becomes more than a legal duty it becomes a shared social norm. Policymakers can design fair, transparent rules that signal widespread participation. Administrators can use data and messaging to show that most people are doing the right thing. Tax professionals can reinforce this norm through advice and practice. Together, they help shift compliance from pressure and punishment to trust and collective responsibility.

Policy: Fairness you can see

For social proof to work, fairness must not only exist it must be visible. Policymakers set the tone by creating tax rules that feel just and transparent to everyday citizens. When people see that progressive tax rates are in place, high-profile tax evaders are held accountable, and exemptions follow clear criteria, they’re more likely to believe the system is working for everyone. This visibility builds confidence and encourages collective participation.

Suggestion: Make fairness visible and relatable. When people see the powerful playing by the same rules, they’re more likely to join in.

Administration: Spotlight on honest behaviour

Tax administrators can bring social proof to life through the messages they send and the stories they tell. By publishing compliance data, showcasing success stories, or recognising compliant taxpayers, they create a public narrative where paying taxes is seen as the norm. From local dashboards to national campaigns, every public display of honest behaviour helps turn abstract duties into visible expectations.

Suggestion: Use every communication tool, SMS, radio, posters, social media to show that compliance is common, expected, and respected.

Professionals: The trusted voice

Tax professionals hold quiet but powerful influence. They are often the bridge between the tax system and the taxpayer. By highlighting what similar businesses are doing, using anonymised examples, or simply framing compliance as smart and standard, they can nudge clients in the right direction without lecturing or pressure. Their trust-based guidance helps normalise responsible behaviour in everyday decisions.

Suggestion: Position tax compliance as the usual, reasonable choice something smart people like your client are already doing.

Social proof is more than a psychological concept it’s a practical strategy for building a culture of tax compliance. When fairness is visible, honest behaviour is celebrated, and trusted professionals reinforce what’s normal, compliance becomes a shared expectation. By working together, policymakers, administrators, and tax advisors can turn “doing the right thing” into something people see, believe in, and follow.

(The writer is Deputy Commissioner General, Inland Revenue Department.)