Türkiye's Use of AI in Tax Evasion Crackdown

Türkiye is launching a significant initiative to combat corporate tax evasion by deploying artificial intelligence (AI) and up to 500 inspectors to analyze the tax returns of citizens and businesses. The program aims to identify companies that are avoiding taxes or underreporting revenue, potentially revealing around $700 million in tax evasion.

The initiative will initially target businesses in 31 of Türkiye’s 81 provinces, with plans to expand as resources become available. The AI will assist in scrutinizing tax returns and monitoring approximately 3,400 companies. Specific areas of focus include revenue from social media and the use of international bank accounts for transactions.

Despite the government’s efforts, economist Sadi Uzunoghlu expressed skepticism about the campaign’s effectiveness in generating significant revenue, arguing that the real issues lie with a small group of companies that benefit from substantial tax exemptions.

While the government plans to reform existing tax exemptions and broaden the tax base, progress on these reforms has been limited. Uzunoghlu believes the discussion around budget and taxation will continue for a long time, emphasizing that superficial measures will not resolve the underlying issues.