The role of artificial intelligence in reducing tax evasion: An implementation strategy

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Abstract

This research investigates the impact of artificial intelligence (AI) technologies on reducing tax evasion within the Palestinian Income and Sales Tax Department. Using a structured questionnaire distributed to 92 employees through stratified random sampling, the study captured responses from various job positions and experience levels. The findings indicate that the implementation of AI-driven predictive analytics and automated auditing tools significantly enhances tax compliance and detection accuracy. These results align with previous research emphasizing the importance of trust in fostering tax compliance in Palestine (Alasfour, 2019) and the emerging role of AI within governance and legal frameworks (Albalawee & Fahoum, 2024). Despite these benefits, challenges such as data privacy concerns, technological unfamiliarity, ongoing system updates, and high implementation costs were identified. To maximize AI deployment, tax authorities should invest in comprehensive training programs and supportive technologies. The proposed implementation strategy focuses on developing AI-specific tools while ensuring data security and fostering employee technological adoption. Future research should assess the long-term effectiveness of AI systems in combating tax evasion and strengthening tax compliance in Palestine.

Keywords: Artificial Intelligence, Tax Evasion, Predictive Analytics, Automated Auditing, Palestine

Authors’ individual contribution: Conceptualization — A.S.H.A., M.A.A.A-Z., and I.M.; Methodology — A.S.H.A., M.A.A.A-Z., and I.M.; Validation — A.S.H.A., M.A.A.A-Z., and I.M.; Formal Analysis — A.S.H.A.; Investigation — A.S.H.A.; Resources —M.A.A.A-Z. and I.M.; Data Curation — A.S.H.A.; Writing — Original Draft — A.S.H.A.; Writing — Review & Editing — A.S.H.A., M.A.A.A-Z., and I.M.; Visualization — A.S.H.A.; Supervision — M.A.A.A-Z. and I.M.; Project Administration — M.A.A.A-Z. and I.M.; Funding Acquisition — A.S.H.A.

Declaration of conflicting interests: The Authors declare that there is no conflict of interest.

JEL Classification: C88, H26, M42, O33

Received: 06.06.2025
Revised: 06.09.2025; 11.12.2025
Accepted: 12.01.2026
Published online: 14.01.2026

How to cite this paper: Alseikh, A. S. H., Al-Zaqeba, M. A. A., & Muhammad, I. (2026). The role of artificial intelligence in reducing tax evasion: An implementation strategy. Corporate and Business Strategy Review, 7(1), 112–122. https://doi.org/10.22495/cbsrv7i1art10