AI integration in tax and judicial administration

Tax and judicial authorities in Italy and the United States are integrating artificial intelligence to improve administrative and legal efficiency.

In Italy, the Ministry of Economy and Finance has used AI-driven data analysis of electronic invoices and financial reports to combat tax evasion, recovering over 100 billion euros over a three-year period. Expanding into the judicial sector, the Italian Court of Cassation conducted a pilot program using Microsoft Copilot to assist in tax dispute processing. The system was used to screen appeals, verify formal requirements, and summarize party positions, though it does not issue rulings. Legal experts emphasize a ‘human reservation of decision,’ noting that under Law 132/2025, magistrates must retain exclusive authority over legal interpretation and evidence evaluation.

Building on these efforts, the Italian Revenue Agency (Agenzia delle Entrate) plans to issue approximately 20,000 compliance letters to property owners by the end of 2026. This initiative utilizes artificial intelligence combined with aerial imagery from Agea to identify discrepancies between physical structures and official cadastral maps, aiming to detect undeclared buildings by comparing satellite and aerial photos with public land registries.

In the United States, the Internal Revenue Service (IRS) is evaluating AI to manage a significant backlog of identity theft cases. Following an audit showing victims wait an average of nearly 20 months for resolution, the agency is considering using AI to triage cases by complexity to reach a 120-day resolution goal.