Skip to content Skip to Search
Skip navigation

Turkey using AI in crackdown on corporate tax evaders

Turkey is using AI to study the tax returns of hundreds of thousands of citizens and thousands of businesses Alamy/Roger Bradley via Reuters
Turkey is using AI to study the tax returns of hundreds of thousands of citizens and thousands of businesses
  • AI in use on tax returns
  • 500 inspectors to be deployed
  • Up to $700m under-reported

Turkey is to unleash hundreds of auditors and artificial intelligence technology on the country’s leading companies to identify those that are avoiding paying tax on earnings or that are downplaying their revenue to escape higher payouts.

Up to 500 inspectors will be deployed in the first stage of a long term programme to stamp out corporate tax avoidance and close down the informal economy, treasury and finance minister Mehmet Şimşek told state news agency Anadolu Ajans on October 13.

Initially, businesses in 31 of Turkey’s 81 provinces will be targeted, he said, with the scheme subsequently being expanded as resources became available.

Along with the battalions of human auditors, Turkey will also use AI in its efforts to root out tax avoidance. 

Studies of the tax returns of hundreds of thousands of Turkish citizens were already being conducted using AI, Şimşek said, while up to 3,400 companies were also being surveyed by technology. Officials of those deemed to be at risk will be summoned for face-to-face interviews. 

Among the operations to be scrutinised will be social media revenue streams and the use of international Iban accounts instead of standard company bank accounts for money transfers, the minister said. 

Turkey has launched a series of investigations into the finances of social media service providers and influencers, and a number of well-publicised cases highlighted widespread under-reporting of incomes. 

According to Şimşek, even preliminary investigations suggested tax avoidance or under-reporting by large companies of close to $700 million.

However, while it is likely the campaign will identify some tax problems among certain companies, economist professor Sadi Uzunoğlu of Trakya University is sceptical that the audit will generate much in the way of revenue for the budget.

Major businesses are generally audited and those listed on the stock exchange are also audited by the Capital Markets Board, the main supervisory and regulatory agency for security markets, he told AGBI.

“The measures announced are for show and indeed miss what the real issues are in taxation,” Uzunoğlu said. “The main problem is the 20 percent top circle who are not taxed heavily and the large tax exemptions granted to some firms.”

Although the government has said it will roll back many of the existing tax exemptions, and institute reforms to broaden the tax base as part of its medium-term economic programme announced in early September, Uzunoğlu said little has been done to enact these reforms to date. 

“The issue of the budget and taxes will be the subject of debate for a long time, and won’t be resolved with window dressing measures,” he said.

Latest articles

Based on the offer price range, Lulu is set to list with a market capitalisation of between AED20.04bn and AED21.07bn

High demand leads Lulu to upsize IPO stake to 30%

Lulu Retail Holdings has increased the size of its initial public offering (IPO) by 5 percent to 30 percent to potentially raise AED6.32 billion ($1.72 billion) on the Abu Dhabi Securities Exchange (ADX) following high demand from investors. The retail chain operator in the Middle East initially offered a 25 percent stake sale. The total […]

Eni had paused its operations at the Zohr gas field but plans to resume drilling in Egypt by the end of the year

Italy’s Eni will restart gas drilling in Egypt and Libya

Italian energy company Eni is reviving its exploration operations on Zohr, Egypt’s largest natural gas field, by the end of the year, its CEO confirmed on Monday. “After some time, we were not really working on Zohr, we will restart drilling by the end of the year, and we are going to drill another well […]

If the Maaden deal goes ahead it will create the seventh largest aluminium manufacturer in the world

Bahrain’s Alba looking to Europe after Maaden deal

Aluminium Bahrain (Alba) will keep exploring mergers and acquisitions, with a particular eye on Europe, once it completes its multi-billion dollar deal with Saudi Arabian Mining Company (Maaden). The deal is expected to be signed off in the first half of next year. The two companies penned a non-binding agreement in September and are in […]

UAE to invest $54bn to meet sustainable energy goals

The UAE plans to invest up to AED200 billion ($54.4 billion) to meet sustainable energy demand over the next six years, minister of energy and infrastructure Suhail Al Mazrouei has said. The move intends to “decarbonise economy and achieve net-zero emissions by 2050”, the UAE state-run Wam news agency reported. “Our efforts to diversify the […]