ARTIFICIAL INTELLIGENCE IN TAXATION: TRANSFORMING GST COMPLIANCE AND FRAUD DETECTION IN INDIA

Abstract

Artificial Intelligence is becoming a technology in modern tax administration. In India the Goods and Services Tax system has created a digital environment involving registration, return filing, e-invoicing, e-way bills and Input Tax Credit. The large amount of transaction data generated through these processes provides opportunities for the application of Artificial Intelligence and Machine Learning. Artificial Intelligence can assist tax authorities in analysing transactions identifying patterns detecting potential fraud and improving taxpayer services.

This paper examines the role of Artificial Intelligence in GST taxation in India. It focuses on the use of Artificial Intelligence for improving GST compliance detecting tax fraud and analysing the benefits and challenges of Artificial Intelligence based tax administration. Artificial Intelligence can help identify invoices unusual ITC claims, inconsistent transactions and potential tax evasion patterns. It can also reduce administrative work and provide faster taxpayer assistance. However challenges such as data privacy, cybersecurity, algorithmic bias, lack of transparency and the requirement, for professionals need to be addressed. The study concludes that Artificial Intelligence can significantly improve GST administration when it is implemented with human supervision, data protection and transparent procedures.