Towards eXplainable Artificial Intelligence (XAI) in Tax Law: The Need for a Minimum Legal Standard

Posted: 10 Jan 2023 Last revised: 11 Jan 2023

See all articles by Blazej Kuzniacki

Blazej Kuzniacki

The Amsterdam Centre for Tax Law (University of Amsterdam); Lazarski University

Marco Almada

European University Institute - Department of Law (LAW)

Kamil Tyliński

affiliation not provided to SSRN

Łukasz Górski

affiliation not provided to SSRN

Beata Winogradska

affiliation not provided to SSRN

Reza Zeldenrust

affiliation not provided to SSRN

Date Written: September 2, 2022

Abstract

Tax administrations globally increasingly rely on artificial intelligence (AI) systems for automation. However, automation has a huge potential impact on the rights of taxpayers subject to algorithmic assessments, which is compounded by the opacity of complex AI systems. This article argues that adequate protection of taxpayers’ rights demands the use of eXplainable AI (XAI) technologies that can render the functioning and decisions of tax AI systems understandable for taxpayers, administrative appeal bodies and the courts. This demand follows from the constitutional principles that guide taxation. Still, it is insufficiently addressed by soft and hard law instruments on AI, which do not address the particular information needs of the tax domain. To address this gap, the authors conclude the article by mapping technical and legal challenges for the proper application of explanation techniques to tax AI to ensure that automation does not come at the expense of taxpayers’ rights.

Full-text Paper

Keywords: artificial intelligence, taxpayer rights, tax compliance

JEL Classification: K33, K34

Suggested Citation

Kuzniacki, Blazej and Almada, Marco and Tyliński, Kamil and Górski, Łukasz and Winogradska, Beata and Zeldenrust, Reza, Towards eXplainable Artificial Intelligence (XAI) in Tax Law: The Need for a Minimum Legal Standard (September 2, 2022). In: World tax journal. - Amsterdam. - Vol. 14 (2022), no. 4 ; p. 573-616 , Available at SSRN: https://ssrn.com/abstract=4321571

Blazej Kuzniacki

The Amsterdam Centre for Tax Law (University of Amsterdam) ( email )

Amsterdam
Poland

Lazarski University ( email )

Świeradowska 43 Warszawa
Warsaw, 02-662
Poland

Marco Almada (Contact Author)

European University Institute - Department of Law (LAW) ( email )

Via Bolognese 156 (Villa Salviati)
50-139 Firenze
Italy

Kamil Tyliński

affiliation not provided to SSRN

Łukasz Górski

affiliation not provided to SSRN ( email )

No Address Available

Beata Winogradska

affiliation not provided to SSRN

Reza Zeldenrust

affiliation not provided to SSRN

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Abstract Views
92
PlumX Metrics