From awareness to action: Applying marketing principles to transform tax administration in Sri Lanka

EVERY nation adopts its own unique approach to managing and administering taxes, reflecting its economic priorities and governance model.

- By Dr. Nalin Abeysekera

In this context, tax administration plays a key role in economic development and is an important performance indicators (KPI) of a government’s success. In Sri Lanka, as in many developing countries, key challenges include low tax revenue, weak enforcement of tax laws, and the need for stronger strategies to improve tax collection and administration. Sri Lanka has had a problem of proper tax collection for decades.

Furthermore, IMF highlights that Sri Lanka needs a fair tax system to boost revenue, stabilise its finances, and support sustainable economic growth during these challenging times. As part of its loan program, the IMF is urging Sri Lanka to carry out tax reforms to strengthen revenue collection and ensure fiscal sustainability. More importantly, we need to understand the role of marketing in tax administration and explore how we can use its concepts in an innovative way in this context.

Tax administration and marketing

There is a need to keep the public and all stakeholders aware of the importance of the tax system and it can be considered as part of tax administration. So we need to understand the importance of “marketing” in tax administration. As highlighted by Beyereh in his article published on thebftonline. com, marketing plays a vital role in modern tax administration by building trust, improving communication, and fostering voluntary compliance. There are many marketing models and strategies we can apply to improve tax administration. In this article, we focus on how the AIDA model can play a role in strengthening tax administration.