Abstract
The Fourth Industrial Revolution (4IR) is characterised by a range of new technologies that fuse the physical, digital, and biological worlds. However, the effect of the 4IR on tax policies and tax administration in South Africa and its impact within the South African Revenue Service (SARS), has largely been ignored. The purpose of this research was to explore the potential impact of the 4IR on the SARS and offer meaningful insights into tax policies and legislative frameworks that could guide the SARS to navigate these changes successfully. The potential impact of the 4IR on Personal Income Tax, Value Added Tax and Corporate Income Tax was evaluated through qualitative research on existing literature. Personal Income Tax will significantly be disrupted due to trends of increased turnover and decreasing demand in the labour market, the amplified need for re-skilling and upskilling of people to accommodate technological advances, possible job losses and undermined job security. Value added Tax and Corporate Income Tax are influenced by the global accessibility of products and services to consumers from across the world and across various jurisdictions. Users of digital products profit greatly from anonymity, making the process of administering taxes even increasingly difficult. Digitisation does have positive effects on tax administration, namely, increased efficiency, increased tax compliance and improved taxpayer services. The interconnection between continual refinement, stakeholder communication, understanding and implementation of AI and robot tax, proactively incentivising the labour market to voluntarily declare, whilst upskilling and maintaining their labour force and digital tax capacity, should be prioritised within the SARS. Tax reform negotiations should be multilateral, and learnings across developed and developing nations are encouraged.
Key Words: Artificial intelligence, Corporate Income Tax, Fourth Industrial Revolution, Personal Income Tax, SARS, Tax administration, Taxation, Value-Added Tax.