Bloomberg, AI Use Helps UK Tax Authority Recover About £8 Billion Annually:
The use of AI by the UK tax office has resulted in the recovery of at least £8 billion ($10.7 billion) for the country annually, a top official said Wednesday.
A majority of employees at His Majesty’s Revenue and Customs “are now saying they are using AI in some form in their day jobs,” Chief Digital and Information Officer Daljit Rehal told Bloomberg Tax in an interview. He added that the full productivity gains are expected to materialize over the next three years.
“We’re at the early stages of monitoring that, but we are seeing encouraging signs,” Rehal said. He said HMRC has been leading “one of the biggest rollouts of internal AI tools” in the UK government.
The tax authority is using AI “to support protection and recovery of at least £8 billion every year,” he said, adding that the tax office is “embracing generative AI to create tax systems that work better for everyone.”
In October, HMRC began deploying Microsoft 365 Copilot, an AI assistant product, which is expected to be used by over 50,000 staff members. The office plans to ramp up use of the technology for risk assessments, compliance activity, and building customer call summaries, Rehal said.
The tax authority released its Transformation Roadmap in July, detailing AI initiatives such as AI-supported compliance casework, expanded digital assistance, and tools to “identify issues with the tax system.”
AI is being used for detecting “spurious, anomalous, suspicious” tax filings, while in the future, taxpayers will receive “nudges and prompts” while they are completing returns to help identify potential errors, Rehal said.
At the same time, HMRC remains cautious about AI-related risks and is conducting “scientific testing” to detect hallucinations, inaccuracies, inconsistencies, and ambiguities in AI outputs. All AI systems operate in secure environments to prevent data leaks, Rehal said.
He emphasized that final compliance decisions will continue to be made by “experienced, trained caseworkers,” despite the increased use of AI.
“The other thing we are looking out for is not to make that automated decision. So the AI assistant is there to just help you make the decision. It’s not going to make the decision for you,” Rehal said.
