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How AI is transforming tax administration across the Commonwealth
Tax administrations are adopting artificial intelligence for revenue mobilisation, predictive analytics and fraud detection - a technological shift that may redefine how they deliver on revenue mandates. This blog explores where AI can strengthen compliance, decision-making, and leadership in tax systems across the Commonwealth, and how the IGC-CATA partnership can help translate research into practical reform.
This post is part of a new series on intelligent taxation and AI, which brings together evidence, policy lessons, and challenges of using AI to strengthen tax administration. Explore the Tax for Growth initiative’s new policy toolkit: Harnessing AI and data for tax administration, which synthesises lessons for governments and Commonwealth tax administrators.
For the past 15 years, digitalisation and technological transformation have been the cornerstone of revenue mobilisation strategies across Commonwealth tax administrations - from Papua New Guinea to Canada, from Kenya to Belize. This focus has enabled tax authorities to modernise systems, improve efficiency, and enhance taxpayer services.
As we step into 2026, the conversation is shifting. We are witnessing another leap forward into the world of artificial intelligence (AI) and big data - one which may redefine how tax administrations operate and deliver on their revenue mandates.
AI is the next big leap for tax administrations - but compliance still matters
AI is no longer a futuristic concept. It is a driver and enabler of smarter, more adaptive tax systems. For tax administrations, AI can mean predictive analytics for compliance, smarter fraud detection, and personalised taxpayer services, to name a few possible use cases.
However, technology alone cannot make up for fundamentals in tax administration. Compliance remains the underlying challenge - technology cannot override systemic issues such as large informal economies, low trust and wider challenges with data quality and transaction information. Digital tools can help, but they can’t fix issues that are fundamentally about behaviour and enforcement.
As administrators embrace AI, they must ensure that compliance strategies remain robust and integrated. Technology should complement - not replace - the basics of sound tax administration.
CATA's digital mandate: Supporting the use of AI in Commonwealth tax systems
Commonwealth countries are positioning themselves at the centre of this revolution. Organisations such as the Commonwealth Association of Tax Administrators (CATA) are in a unique position to work with tax authorities across the globe at different economic positions to identify and bring together lessons on how AI and big data can best play a role within tax systems.
CATA is committed to helping member nations navigate this new terrain and harness its benefits. This commitment to digitalisation is deeply embedded in our strategic plan and is expressed through our partnership with the International Growth Centre. This partnership aims to combine cutting-edge research with practical implementation strategies to best understand how tax administrations can leverage AI effectively.
The strength of the CATA-IGC partnership can catalyse transformation
Convincing leadership within tax administrations to prepare for the future of AI is critical. Transformation requires vision, resource allocation, and a commitment to capacity building. CATA can be a key partner in this journey by supporting leaders to make informed decisions and equipping tax officials with the tools and foundations they need, and a vision of what can be possible.
CATA’s convening power positions us to foster cross-country learning among some of the world's most diverse nations. Our members span almost every continent, bringing unique skills, opportunities, and perspectives to the table. Our leadership initiatives, including high-level dialogues and targeted training programmes, are designed to foster buy-in and create a culture of innovation across member countries.
Evidence-based research from partners like the IGC will anchor this transformation by bringing insights from countries across the Commonwealth to systematise what we know so far.
But research must be actionable - it should guide policymakers and inform real-world solutions. For example, lessons from past research on electronic fiscal devices (EFDs) show that technology does not always deliver huge or fast outcomes. This type of research underscored the need for adaptive strategies and realistic objective setting, grounded in evidence.
What’s next for AI and tax administration?
The journey from digitalisation to transformation is not just about adopting new technologies - it’s about reimagining how tax administrations operate in an increasingly complex world. AI and big data offer immense potential, but success will depend on strong compliance frameworks, visionary leadership, and partnerships that drive evidence-based innovation.
At CATA, we are committed to igniting this transformation - joining forces with our members and partners to turn change into opportunity. Through collaborative learning and shared experiences, we can identify what works, what doesn’t, and how to scale successful models across the Commonwealth.
In the coming months, IGC and CATA will be participating in key engagements, including the Commonwealth Dialogue in India, the launch of the Working Group on Data and AI Use in Tax Administration, and the 46th CATA Annual Conference in Tanzania. These events will provide platforms for knowledge exchange, capacity building, and collaborative problem-solving.