Artificial Intelligence and Tax Administration : Strategy, Applications and Implications, with Special Reference to the Tax Inspection Procedure

Abstract

This article provides insights into the use of artificial intelligence (AI) by tax administrations as a means of transforming tax procedures by improving tax efficiency and transparency, coming up with ideas and plans to implement new data-driven tax administrations, automating repetitive tax tasks, improving the fight against tax evasion, obtaining tax information to be used by the tax administration and providing other taxpayer services. Although the article focuses mainly on the use of AI in tax audits and the way to identify tax risks and taxpayer segmentation through AI, it also includes some reflections on data governance. Due to the fact that tax administrations are currently at different stages of AI use, the author aims to reveal the state of the art of AI in the tax world and to foster the ethical and responsible use of AI in tax administrations, in balance with taxpayers' rights and guarantees. Modern tax administrations cannot allow themselves to be anything but efficient and transparent in the fight against tax evasion.

Full-text Paper

Keywords: artificial intelligence, big data, information technology, tax authorities, tax evasion, audit, risk management, automation, data protection, taxpayer rights, tax compliance, control

JEL Classification: K33, K34