Source: The Economic Times

The Economic Times reports on the plans of India's Central Board of Direct Taxes (CBDT) to significantly increase its use of artificial intelligence and big data analytics to combat tax evasion. According to CBDT Chairman Ravi Agrawal, this technological escalation is a key preparatory step for the rollout of a new, simplified income tax law. The department aims to create a more robust and non-intrusive system for ensuring tax compliance by leveraging AI to analyze vast quantities of financial data from multiple sources, including bank transactions, property registrations, and social media activity.

The AI-driven system is designed to identify patterns and anomalies that may indicate undisclosed income or fraudulent claims, allowing tax authorities to target their investigations more effectively. This data-centric approach is intended to reduce the need for random, intrusive audits and shift the focus to high-risk cases identified by algorithmic analysis. Chairman Agrawal stated that the goal is to make tax evasion increasingly difficult by creating a 360-degree profile of taxpayers' financial activities. This move signals a major shift in India's tax administration, embedding advanced technology at the core of its enforcement strategy to improve revenue collection and ensure greater compliance with the forthcoming legal framework.