Tax Inspections in Italy embrace AI as the Revenue Agency’s New Chatbot Zeroes in on Potential Tax Evasion

Italy’s Revenue Agency introduced an AI-powered chatbot to analyze tax returns, focusing on discrepancies among self-employed individuals and irregular accounting to enhance the detection of potential tax evasion.
Developed with Sogei and the Department of Finance, the chatbot analyzes expenses, income, and VAT data in real-time, enabling auditors to better target potential evasion and increase audit efficiency.
The AI system cross-references data and identifies evasion patterns beyond simple miscalculations, examining the ratio of reported expenses to income and discrepancies in VAT filings.
By aggregating tax data demographically and geographically, the AI system creates a comprehensive financial snapshot of Italy, offering insights previously only possible through manual methods by Istat.
Although AI automates and enhances audits, human auditors will still conduct deeper investigations into anomalies identified by the chatbot, ensuring thorough review and interpretation of complex cases.
The expanded use of AI is expected to increase the number of tax audits significantly, improving compliance and detecting tax evasion risks more effectively than previous traditional audit methods.