[World Tax News] USA Expands Use of ‘CHATBOT’ to Assist Individuals on Tax Notices and More

Editorial Team – [2023] 154 taxmann.com 631 (Article)

World Tax News provides a weekly snippet of tax news from around the globe. Here is a glimpse of the tax happening in the world this week.

1. USA expands use of ‘CHATBOT’ to assist individuals on tax notices

The United States Internal Revenue Service (IRS) has introduced enhanced chatbot technology to respond quickly to fundamental inquiries from individuals who have received notices regarding potential tax underreporting.

The newly introduced chatbot function will provide support to taxpayers who receive notices CP2000, CP2501, and CP3219A.

The introduction of this chatbot further leverages the IRS’s previous accomplishments in enhancing taxpayer service through technology. Since January 2022, IRS voice and chatbots, available in both English and Spanish, have assisted over 13 million taxpayers in swiftly addressing their tax concerns, establishing approximately $151 million in payment arrangements and avoiding extended wait times.

The chatbot simulates human interaction with taxpayers through a web or mobile app on a computer or mobile screen by responding to questions or requests in a chat feature. Additionally, at the conclusion of the conversation, taxpayers have the option to click the “representative” button to connect with a live assistant.

The new IRS chatbot is available to help taxpayers with questions such as:

• What to do if they received a notice.
• What to do if they need more time to respond to a notice.
• How to find out if the IRS received their response

The IRS plans to continue additional bot technology features in the future to assist taxpayers with more complex issues.

Source: IRS website

2. Japan is considering tax incentives to encourage investments in battery and semiconductor production

The Japanese government is considering tax incentives to lower production costs in such fields as semiconductors, batteries and biotechnology. This includes the introduction of new tax credit incentives tied to both production and sales, which will remain accessible for a period ranging from 5 to 10 years following the initial investment.

During a cabinet meeting, Prime Minister Fumio Kishida emphasized semiconductors as a strategic investment due to their capacity to stimulate growth in rural areas and elevate wages.

Previously, the Japanese government has aimed to enhance domestic chip production, primarily focusing on the supply of manufacturing equipment, including deep ultraviolet lithography (DUV) machines. In May, the Prime Minister signed the Hiroshima Accord, a bilateral agreement with the UK to collaborate on semiconductor-related initiatives.

Source: Official Website

3. Hungary seeks to sustain low taxation despite introduction of Pillar 2 Global Minimum Tax

The Ministry of Finance in Hungary has released a statement informing that discussions have been initiated with major Hungarian corporations regarding the adoption of Pillar 2 Global Minimum Tax (GMT) in compliance with Council Directive (EU) 2022/2523 dated December 14, 2022.

As stated in the announcement, the government’s objective is to structure the GMT regulation in a manner that preserves the competitiveness of the Hungarian tax system in light of the GMT, ensuring that Hungarian companies continue to maintain one of the lowest tax rates in Europe.

The Ministry of Finance will present the specific guidelines for implementing the Council Directive to Parliament alongside the autumn tax legislations.

Source: Official Release