Türkiye to Use Artificial Intelligence in Tax Inspections

Türkiye plans to introduce a new tax information processing system based on artificial intelligence. The VDK-İHS project will form part of the Medium-Term Economic Program for 2027–2029 and is intended to improve tax risk analysis, increase the efficiency of inspections and help combat the informal economy.

Artificial Intelligence to Support Tax Control

Under the Medium-Term Economic Program, Turkish authorities plan to make greater use of digital technologies in tax administration. One of the key projects will be the VDK-İHS tax information processing system.

The system will use artificial intelligence technologies and cognitive decision-making mechanisms. It is expected to become an important source of information for identifying risks associated with the informal economy and potential violations of tax legislation.

Artificial intelligence and big data analysis are planned to help identify tax risks, reduce errors and improve the efficiency of inspection processes.

Big Data Will Be Used to Assess Tax Risks

The program calls for sector-specific, financial and thematic risk analysis using large datasets and modern analytical tools.

The results will be shared with relevant government institutions and organizations. This is expected to help authorities identify more precisely where additional tax control may be required.

Particular attention will be given to taxpayers and economic sectors classified as higher risk following the analysis.

Key Areas of the New System

• AI-powered tax risk analysis;
• processing of large volumes of financial and administrative data;
• identification of potential tax errors and inconsistencies;
• more efficient tax inspections;
• reducing the size of the informal economy;
• expanding the tax base;
• improving tax gap assessment mechanisms.

New Types of Economic Activity Will Also Be Monitored

Authorities also plan to develop new digital tools to record and document economic activities emerging as a result of the digital economy and new business models.

During tax inspections, administrative data provided by third parties may be used to verify the accuracy of taxable transactions.

Depending on the sector and the individual taxpayer’s risk level, different audit methods may be applied.

Systems Already Used for Economic Monitoring

The program also refers to several high-tech monitoring systems used to track different areas of economic activity:

• DBYS – Deposit Information Management System;
• KMTS – Precious Metals Tracking System;
• İDİS – Reinforcement Steel Tracking System;
• UTTS – National Vehicle Identification System;
• BÜİS – tracking system for products subject to marking.

The use of these systems is intended to help authorities identify undeclared transactions and reduce the scale of tax evasion.

Real Estate Transactions to Receive Particular Attention

Real estate is also included among the areas covered by the program. Authorities plan to continue efforts to ensure that property transactions are carried out at their actual values.

This is an important development for Türkiye’s real estate market, as the government continues to strengthen digital monitoring and the comparison of information held across different government databases.

Buyers and property owners in Türkiye should keep track of changes affecting property transactions and tax legislation. RestProperty continues to monitor regulatory developments that may be relevant to people buying or owning property in Türkiye.

Digital Tax Inspections to Expand

Tax inspections are also planned to continue through the VDK-RAS Risk Analysis System. In addition, the VDK-DUY digital compliance project will be further developed.

Authorities will continue checking taxpayers’ income to improve the accuracy of annual income declarations.

Overall, the government expects automated data analysis to strengthen tax compliance, expand the tax base and make inspections more targeted and effective.

Türkiye’s growing use of artificial intelligence and digital monitoring is set to play an increasingly important role in the country’s tax administration over the coming years.