The behavioral economics it is a branch of economic science that combines psychology and economics to understand how people really make decisions. Unlike traditional theory, which assumes that individuals are rational and maximize their benefit, behavioral economics shows that many of our decisions are influenced by emotions, habits, biases and social contexts.

This perspective offers a valuable lesson for public policies: small adjustments in the way information is presented or achievements are recognized can lead to significant changes in citizen behavior.

This logic inspires one of the most outstanding innovations of Dominican public management: the Tax Scoring, developed by the Dominican Tax Administration. This pioneering digital tool in Latin America applies the principles of behavioral economics to complement the traditional mechanisms of control and sanction, strengthening the management of tax compliance with transparency, motivation and recognition.

What is Tax Scoring?

Tax Scoring is a tool designed to measure and improve compliance with the formal obligations of taxpayers, that is, the filing of declarations, the sending of reports and the making of payments within the established deadlines. This behavior is translated into a universal language: the stars. Five stars indicate that the taxpayer is in good standing, while a lower rating indicates pending tax commitments to be filed.

Each taxpayer can view their score only from their Virtual Office, in strict compliance with tax confidentiality rights. Although this information is not public, some companies have voluntarily chosen to share their five stars on social networks, annual reports and other corporate spaces, using them as a symbol of transparency, internal organization and good tax governance.

A complement that strengthens the tax compliance management

Controls, audits, and sanctions remain essential pillars for ensuring fairness and fiscal discipline. However, their effectiveness can be enhanced by incorporating behavioral strategies that encourage voluntary self-management, transparency and mutual trust between the Tax Administration and taxpayers.

Instead of replacing control management, Tax Scoring strengthens it. While the control mechanisms make it possible to detect non-compliance, the scoring encourages voluntary improvement and promotes a culture of conscious compliance. Both instruments complement and reinforce each other, forming a comprehensive strategy that combines prevention, transparency, and fiscal responsibility.

In 2025, this project was recognized at the National Award for Public Innovation, organized by the Administrative Ministry of the Presidency of the Dominican Republic, for being a pioneering public policy in Latin America that unites efficiency, transparency and citizen motivation.

How behavioral economics improves tax compliance

Behavioral economics has shown that many defaults do not come from deliberate evasion, but from the complexity of the system, lack of information or poor motivation. The Tax Scoring it acts on these factors by “nudging” (nudges) visuals: a simple stimulus that turns compliance into a source of pride and recognition.

When a company visualizes its stars, it receives immediate feedback that allows them to correct on time and maintain their reputation. The result: 83.4% of taxpayers improved or maintained their behavior in a few months, without increasing penalties or administrative costs.

Multiplier effects of a good example

The Scoring has generated a chain of behavioral effects that strengthen the tax culture:

• – Positive reputation: companies with five stars are perceived as reliable, transparent taxpayers who are committed to playing by the rules.
• – Social comparison and the FOMO (Fear of missing out) effect: observing other companies comply stimulates voluntary improvement and reduces indifference to compliance.
• – Public commitment: those who display their rating seek to maintain it.
• – mmediate feedback: continuous access to the rating facilitates timely correction before any administrative action.
• – Halo effect: the visibility of the system strengthens public confidence in the Tax Administration and reinforces its legitimacy.

Together, these mechanisms create a virtuous circle where guidance and cooperation reinforce each other, generating an environment of greater compliance, trust and citizen commitment.

Innovating with purpose

The Tax Scoring it was developed entirely with talent and internal resources of the Dominican Tax Administration, without additional budget. It is an example of sustainable public innovation that combines technical analysis, applied psychology and institutional vision.

By integrating control and motivation, the DGII managed to modernize compliance management without renouncing firmness, but adding empathy. The message is clear: fulfilling is not only an obligation, it can also be a source of pride and recognition.

Thus, the Dominican Republic is consolidating its position as a regional benchmark in public innovation based on behavioral science, demonstrating that a Modern State can collect taxes with rigor, with intelligence and with humanity.

To learn more about Tax Scoring and how it works, you can consult the official brochure at: https://dgii.gov.do/publicacionesOficiales/bibliotecaVirtual/contribuyentes/Otros/Documents/Brochure%20Scoring%20Tributario.pdf

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