AI moves GST into its next phase
India is entering the next phase of its Goods and Services Tax (GST) regime, with the tax authorities significantly expanding the use of artificial intelligence (AI), machine learning and advanced data analytics to improve compliance, accelerate refunds and combat tax evasion.
Almost a decade after GST was introduced, the focus is shifting beyond digitising tax administration towards intelligent automation. AI is now being used to analyse taxpayer behaviour, identify risk patterns, support GST registrations, scrutinise returns and target high-risk taxpayers, while reducing manual intervention for compliant businesses.
Better data sharing to strengthen compliance
The Indian government is integrating GST, customs and income tax data to strengthen risk assessments and improve the accuracy of compliance monitoring. Alongside tougher enforcement, businesses should benefit from faster GST refunds, simplified compliance processes and reduced audit burdens.
Businesses call for AI-powered GSTN 2.0
Industry is also pushing for the next generation of GST technology. A recent Deloitte survey found that 89% of businesses want AI-powered reconciliation and automated compliance capabilities embedded into a future GSTN 2.0 platform, alongside pre-filled returns and intelligent matching of transaction data.
AI becoming central to tax administration
Like many tax authorities worldwide, India is moving towards AI-enabled, data-driven tax administration where automation improves both taxpayer experience and enforcement effectiveness. For multinational businesses operating in India, investing in high-quality transaction data and AI-ready tax technology will become increasingly important.
VATCalc safely incorporating AI into tax calculations and returns
See how else VATCalc is applying Artificial Intelligence since 2023 to enhance VAT determination, returns and e-invoicing:
- AI and item classification in VAT determination;
- Tax advice generated by AI from our VAT expert-maintained tax engine
- Tax code mapping with AI to reduce significantly tax engine implementations and testing
- AI VAT Copilot to help you prioritise your tasks, manage workflows and uncover deep date insights
We have since moved through to develop the world’s first Agentic AI VAT tax engine, embedding our tech across all platforms.
