The Department of Revenue has been recognized with a 2020 Government Innovation Award for its work on "nudge" tax delinquency notices. These notices were created through a collaborative project between Revenue staff and a team of social behavioral scientists from the MITRE Corporation. The goal of the project was to study taxpayer behavior and redesign the department's tax delinquency notices, making them easier for taxpayers to understand and more likely to result in a response.
Revenue's nudge project team is being recognized in the Public Sector Innovations category, which focuses on creating or utilizing new technology to make government function better. The Government Innovation Awards are presented by two technology publications, Federal Computer Week and Government Computer News, in addition to Washington Technology and Defense Systems.
"Receiving this Government Innovation Award is a testament to the hard work of our project team and the innovative thinking that went into this study," Revenue Secretary Dan Hassell said. "Not only do nudge notices improve communication and service for our customers, but the commonwealth also benefits with increased revenue collections because taxpayers have a better understanding of what they need to do to resolve their tax obligations."
The nudge project, previously detailed in the PA Tax Update, examined the impact that redesigned and simplified plain language text in tax notices would have on taxpayers. The text of the redesigned letters highlighted the actions that businesses need to take in order to comply and the consequences of not complying. Revenue employees worked with the MITRE Corporation's social behavioral scientists to compare how taxpayers responded to the nudge notices as opposed to the standard department notices that had been in use for many years.
The project found that the redesigned notices resulted in a greater response rate, with businesses responding at a 36% rate, compared to 26% for the standard reminder. In addition to the improved response rate, the taxpayer paid down an average of 9% more of the debt.
Radee Skipworth, the department's former Deputy Secretary for Compliance and Collections, said of the project: "It was definitely radical — just head and shoulders above what we've done in the past. The nudge gave taxpayers the right information, high on the page, and clearly explained what to do. Beyond that, the MITRE team brought capabilities in measuring response rates and statistical analysis."
Two of Revenue's key contributors to the nudge project, Skipworth and Christopher Pressley, recently left the Department of Revenue to work for the District of Columbia Office of Tax and Revenue. Kevin Milligan, the department's Special Advisor to the Deputy Secretary for Taxation, also played a pivotal role in the project. Other key Revenue contributors on the project are Jesse Stiely, Jim Schlegel, Todd Evans, Mark Morabito and Norma Ickes.
"We would not have received this recognition without the key contributions of everyone on the project team," Secretary Hassell said. "Their work on this project has helped us develop a new vision for what our tax notices should look like. That will be a great benefit for our customers for years to come."
This is the second year in a row in which the department has received a Government Innovation Award. The department was recognized in 2019 for its Intelligent Mail Barcode project.