The Government of India has recently launched a “Transparent Taxation Platform” that aims to reduce the compliance burden and reward honest taxpayers. The platform uses data analytics, artificial intelligence (AI), and machine learning (ML) against tax fraud and tax evaders. It is seen as a major step towards the progression of the digital economy. Income Tax Department depends on human tax assessment to assess tax returns, which could cause inefficiencies and tax evasion at a high rate.
Chief Strategy Officer at iValue InfoSolutions Sriram said that technologies like Data Analytics and AI accurate results without any personal bias for the Government to function more effectively and efficiently. Since the number of tax fraud cases are increasing, the importance of automated and strict protocol becomes a need.
The use of AI/ML against tax fraudulent practices was prevalent in European countries. With the help of AI tools, Denmark was able to find tax fraudulent cases for about 60 in every 100 cases. Countries like Norway and France use AI as a preventive measure against tax fraudulent activities.
A major step in making a tax system seamless, painless and faceless was the introduction of Document Identification Number (DIN) where every communication of the department would bee carried out with a unique document identification number.
The implementation of artificial intelligence could offer a large number of benefits. Due to various reasons a lot of disruptions are happening in taxation. Therefore, the use of AI would offer visibility in the transactional data, helps to manage risk, improves efficiency, and offers exact insights about business.AI will be loaded with data such as tax codes, case law, and guidelines that help to make proper decisions. Introducing AI and data analytics would provide a transparent process, tech-friendly and it is a bold step in the country.
CEO of TechnoBind said that the use of AI and Analytics projects the country is not only concentrating on the development of cutting-edge technology but also focus on making citizen life better. Gurpreet Singh, Managing Director at Arrow PC Network says that the use of Data Analytics and AI will improve the quality of assessment even if there is a difference of opinion of taxpayers and the department.