Can AI Reinvent India’s Tax System?

Can AI Reinvent India’s Tax System?

Muskan Malhotra

Abstract

Economic development is severely hampered by tax evasion, particularly in developing nations like India. Further, India's tax structure and the country's high rate of informal economic activity makes the Enforcement and compliance more difficult. The potential of artificial intelligence (AI) technologies, including machine learning, data analytics, and natural language processing, to revolutionize tax administration is examined in this study which can help in overcoming the problem of tax evasion. The potential of AI to increase transparency, automate anomaly detection, and develop effective tax compliance systems is emphasized. This article outlines the prospects and problems associated with the deployment of AI for tax governance in India, drawing on both international case studies and domestic initiatives like the Goods and Services Tax Network (GSTN) pilot programs.

Keywords

Artificial Intelligence, Tax Transparency, Tax Evasion, India, Machine Learning, GSTN, Tax Compliance