Income Tax: Could AI simplify tax filing and benefit citizens as well as government alike? Check details

As we all know, artificial intelligence ( AI ) has become really important to the continued existence of the modern world. The simulation of human intelligence processes by machines, particularly computer systems (AI), has an impact on practically every aspect of society. AI has specific applications such as expert systems, natural language processing, speech recognition, and machine vision.

If you are wondering how the Income Tax Department will benefit citizens and the government by implementing AI, here Agam Gupta, Executive Director at Share India Fincap Pvt. Ltd., explains about the same. According to reports, he said, “Implementing AI to simplify tax filing could benefit citizens and the government alike. With advanced natural language processing capabilities, intelligent chatbots could understand complex financial data and automatically populate returns for review. This would save time for filers while reducing processing costs for the tax authority. However, rigorous testing and a focus on the user experience are crucial, as one minor error could lead to penalties or audits. AI promises major gains in speed and convenience, but appropriate safeguards must support its rollout.”

Speaking to Ashish Aggarwal, Director, Acube Ventures , about the same, we came to know what he was thinking about it. He said, “India would do well to pursue AI for routine tax filing tasks. Automating data collection and calculations, AI can prefill tedious paperwork so citizens merely review and submit. This would encourage higher voluntary compliance from new filers while freeing up resources to investigate evasion. For such systems to take hold, though, accessibility and security are paramount. User-friendly design with multilanguage support reaches more Indians, while stringent cybersecurity protections and explainable AI build public trust. If executed responsibly, tax AI could bring paperless paradise closer to reality.”

Though the Income Tax Department has taken the initiative to investigate the use of artificial intelligence (AI) in public administration. The agency was using AI to create regression models to identify and segregate deviations and errors in tax filings for further analysis.