In a recent address at the 5th Tax Law Conference, Giorgos Pitsilis, the head of the Independent Authority for Public Revenue (AADE), unveiled the authority’s plan to integrate artificial intelligence (AI) into its services. This initiative aims to streamline its operations and also curb tax evasion effectively.

Pitsilis detailed how the AADE has already embedded AI and data mining programs within its functioning. This AI integration involves a comprehensive approach:
By leveraging Artificial Intelligence, the AADE gains the capability to reveal
taxable material by:

– Analyzing extensive datasets from diverse sources, including bank transactions, digital public platforms, and social media networks.
– Detecting behavioral patterns such as unusual transactions, money transfers, and card payments to unregistered sellers, often linked with unreported economic activity in the sharing economy.
– Identifying abnormalities and unusual deviations in citizens’ and businesses’ incomes, such as inconsistencies between income sources and expenditures.

Pitsilis emphasized that these methods could lead to more targeted tax audits by:

– Predicting tax violations using machine learning models to estimate the risk of tax infractions based on past behavioral patterns indicating potential tax fraud.
– Developing risk profiles for taxpayers and businesses concerning the likelihood of tax evasion, enabling tax authorities to prioritize and focus audits on specific groups.

The integration of AI aims to enhance taxpayer compliance by:

– Introducing automated assistance systems during tax declarations to aid taxpayers in accurate and hassle-free submissions.
– Implementing intelligent virtual assistants (“smart agents”) to provide advisory support to taxpayers, facilitating their compliance with tax regulations.
– Establishing online educational platforms with targeted material on tax compliance to help taxpayers understand their obligations and rights.

Additionally, the authority is undertaking projects funded by the Recovery and Resilience Fund to harness AI technologies and other advanced data analysis tools for intelligent cross-checking within tax administration processes.