Beyond Tax Compliance: Developing a Fiscal Adaptability Theory for AI-Based Digital Economies
DOI:
https://doi.org/10.66203/econovia.01203Keywords:
fiscal adaptability, adaptive tax administration, AI-based digital economies, dynamic capabilities, digital government, revenue sustainabilityAbstract
Artificial intelligence-driven digital economies have transformed the institutional environment of taxation, creating challenges that extend beyond taxpayer compliance to the adaptive capacity of tax administrations. Although research on tax compliance, digital taxation, and technology-enabled enforcement has expanded, existing studies provide fragmented explanations of how fiscal institutions sustain long-term revenue capacity amid technological disruption. This conceptual paper addresses this gap by developing a middle-range theory explaining the adaptive mechanisms through which tax administrations respond to AI-driven digital transformation. Integrating Tax Compliance Theory, Institutional Theory, Dynamic Capabilities Theory, and Digital Government Theory, the study develops Fiscal Adaptability Theory, positioning fiscal adaptability as the core organizational capability linking AI-Enabled Fiscal Intelligence, Fiscal Sensing Capability, Institutional Learning, Adaptive Fiscal Governance, Adaptive Enforcement, and Revenue Sustainability. The proposed framework shifts attention from taxpayer behavior to institutional adaptability, explaining how technological intelligence is translated into sustainable fiscal outcomes through adaptive organizational processes. The theory provides a conceptual foundation for future empirical research while offering strategic insights for strengthening adaptive tax administration and fiscal resilience in rapidly evolving AI-driven digital economies.
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