South Africa’s SARS uses AI to boost tax revenue, lessons for Nigeria’s FIRS

South Africa’s revenue authority, SARS, has integrated artificial intelligence, machine learning and data analytics into every stage of tax administration, according to a TechCabal interview with Siphithi Sibeko, Head of Communication and Media. AI now drives auto‑assessments, fraud detection, compliance verification and audit selection, contributing R304 billion ($18.2 billion) to the 2024/25 fiscal year and preventing more than R417 billion ($25 billion) in improper refunds over the past five years. As of 1 July 2026, 1.9 million taxpayers were auto‑assessed, with R8 billion ($479 million) in refunds paid within 72 hours. SARS builds a digital taxpayer profile by pulling data from employers, banks, medical schemes, retirement funds, insurers, investment managers, government registers, foreign tax authorities and crypto‑reporting frameworks, enabling it to track income from e‑commerce, freelancing and digital assets that traditional audits miss. The authority says the technology supports, not replaces, human judgement, with risk flags reviewed through governance processes before enforcement. For Nigeria, this shows how AI‑driven tax systems could boost Federal Inland Revenue Service collections, broaden the tax base to include the growing digital economy and speed up refunds, while still requiring human oversight. Taxpayers should watch for FIRS digital upgrades, ensure their income from online work or crypto is declared, and use available e‑filing platforms to stay compliant.

SOURCE: https://techcabal.com/2026/07/27/ai-south-africas-taxman/