AI to Play Bigger Role in Curbing GST Evasion, Speeding Up Refunds and Improving Compliance
Summarized by AI; it may make mistakes. Check important info
Summarized by AI; it may make mistakes. Check important info
The Indian government is increasingly deploying Artificial Intelligence (AI), Machine Learning (ML) and advanced data analytics to strengthen Goods and Services Tax (GST) administration, improve tax compliance, expedite refund processing and crack down on tax evasion.
Nearly a decade after the introduction of GST, tax administration is moving beyond basic digitisation towards intelligent automation to make compliance more efficient and enforcement more effective.
AI to identify high-risk taxpayers
According to officials familiar with GST operations, AI is now being used to analyse taxpayer behaviour, identify risk patterns, assist in GST registrations, scrutinise tax returns and flag high-risk taxpayers who may be involved in tax evasion.
The technology is also helping reduce manual intervention for businesses with a strong compliance record, enabling faster and more streamlined processing.
Better integration of tax databases
To strengthen compliance monitoring, the government is enhancing coordination between various departments by integrating data from GST, Customs and Income Tax systems.
Officials believe the unified data ecosystem will improve risk assessment, enhance the accuracy of compliance monitoring and make enforcement more targeted.
With stricter implementation backed by technology, businesses are expected to benefit from quicker GST refunds, simplified compliance procedures and fewer audit-related burdens.
Businesses seek more AI-powered GST services
The industry has also called for greater adoption of advanced technology in the GST ecosystem.
According to a recent survey, 89% of businesses want the proposed GSTN 2.0 platform to include AI-powered reconciliation, automated compliance tools, pre-filled returns and intelligent transaction matching to simplify tax filing and reduce errors.
The government has already begun integrating AI into GST calculations, return filing and e-invoicing processes based on business transactions. AI has been supporting improvements in value-added tax assessment, return verification and e-invoicing since 2023.
