This paper examines the opportunities and limitations of applying artificial intelligence (AI) within the tax administrations of Bosnia and Herzegovina through an analytical framework that integrates the normative, institutional, and technological preconditions of the system. The objective of the research is to provide a comprehensive understanding of how AI can enhance risk management processes, supervision, regulatory interpretation, and the relationship between tax authorities and taxpayers, while simultaneously identifying obstacles arising from a fragmented fiscal structure, uneven administrative practices, and the lack of standardized data.
Methodologically, the paper relies on a qualitative analysis of the existing legislative framework, comparative international practices, and principles of public revenue management, complemented by a theoretical perspective on the transformative effects of digital technologies in public administration. The findings indicate that AI has the potential to serve as an instrument of institutional modernization; however, its effective application depends on the level of technical readiness, data quality, and institutional willingness to adopt an analytical, evidence-based approach.
The conclusion emphasizes that artificial intelligence does not represent a substitute for existing institutions, but rather a mechanism capable of strengthening their efficiency and transparency, provided that modernization is implemented gradually and within a clearly defined strategy for the development of tax administrations.
JEL Classification: H21, H26, H83, O33
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