A Message That Pays: How WhatsApp Increased Tax Compliance in Indonesia

A field experiment in Indonesia found that a positively framed WhatsApp reminder significantly increased property tax payments, especially among habitual late payers. In contrast, a more confrontational message produced only short-term effects, showing that tone plays a crucial role in improving compliance.

In Gorontalo City, a coastal hub in northern Indonesia, property tax is the main source of local revenue. The money funds roads, public facilities, and city services. But in recent years, the city faced a growing problem: more people were paying late, and unpaid tax bills were piling up.

After a government reassessment increased property values, average tax bills more than doubled. On paper, the city’s revenue potential grew sharply. In reality, arrears also surged. Many residents eventually paid, but often after the deadline. That made it difficult for the city to plan its budget and deliver services on time.

Enforcement options existed, such as fines and penalties. But these measures were expensive, time-consuming, and politically sensitive. Local officials needed a solution that was affordable, scalable, and effective.

A Simple Idea: Send a WhatsApp Message

Indonesia is one of the world’s most connected countries. Most people use smartphones, and WhatsApp is the most popular messaging platform. City officials, working with researchers from the World Bank and Duke University, decided to test whether a simple reminder sent through WhatsApp could improve tax compliance.

They selected 801 property owners who had not paid their 2023 tax bill and verified that their phone numbers were active on WhatsApp. These taxpayers were randomly divided into three groups.

The first group received no message. The second group received a reminder written in a friendly, positive tone. It emphasized that most residents had already paid and explained that property tax helps fund city development. The third group received a similar message, but with a firmer tone. It stressed that the city government depends on each citizen’s contribution to run development programs.

The difference between the two messages was just one sentence. But the tone was clearly different.

Tone Made a Big Difference

The results were striking. The positive, civic-minded message led to a clear and lasting increase in payments for the 2024 tax bill. By the October deadline, payment rates in this group were about 9 to 11 percentage points higher than in the group that received no message. Even six months later, the difference remained close to 10 percentage points.

In contrast, the firmer message produced only a short-term effect. Some taxpayers paid soon after receiving it, but the impact faded over time. By six months, the difference between this group and the control group was very small.

In other words, the positive message did not just make people pay earlier. It made more people pay overall.

Helping the Most Struggling Taxpayers

The strongest impact was seen among residents who had a history of paying late or missing payments. For these taxpayers, the positive message increased the chance of paying the 2024 bill by more than 16 percentage points by the deadline. That is a large improvement.

Even more important, the message narrowed the gap between frequent late payers and reliable payers. After the intervention, their payment rates were nearly the same. Among taxpayers who already had strong payment records, neither message made much difference, likely because most of them were going to pay anyway.

Interestingly, the messages did not do as much to recover older unpaid bills. Instead, they mainly improved payment of the current year’s tax. This suggests that people may prefer to stay up to date rather than clear past debts.

A Low-Cost Tool With Big Potential

The intervention was inexpensive. After a small setup cost, each WhatsApp message costs only a few cents to send. For a city with limited administrative resources, this made the approach highly cost-effective.

The study also challenges a common belief that stricter or more threatening messages work best. In many countries, warnings about penalties increase compliance. In Gorontalo, however, a respectful and positive tone worked better and lasted longer.

The lesson is clear: context matters. Culture, trust in government, and communication style all influence how people respond. What works in one country may not work in another.

Digital reminders are not a replacement for tax reform or strong administration. But when delivered through a trusted and widely used platform, and when carefully worded, they can make a real difference.

In Gorontalo, one simple WhatsApp message helped boost tax payments, reduce compliance gaps, and strengthen local revenue. Sometimes, improving public finance does not require new laws or heavy enforcement. Sometimes, it just requires the right words.