Optimizing Tax Expenditure and Mobilizing Tax Revenue Through Ethical Artificial Intelligence

Abstract

Tax policy is an essential tool for promoting economic growth and social development, with tax expenditures playing a central role in stimulating investment and supporting development projects. However, empirical studies show that these expenditures often fail to achieve their objectives and result in significant revenue losses for the state. In this context, artificial intelligence (AI) offers innovative solutions to optimize tax expenditures and improve tax revenue mobilization, but raises ethical issues regarding the protection of taxpayers' privacy and confidentiality. This paper examines how the integration of ethical principles moderates the relationship between tax expenditure optimization and tax revenue mobilization, using the autoregressive distributed lag (ARDL) model. Our results confirm that tax expenditure optimization has a limited impact on tax revenue mobilization and that the integration of AI ethics has a moderating role in this relationship in the positive direction to optimize tax expenditures and maximize tax revenue.