What Happens When AI Gets GST Wrong: The Explainability Problem in Financial Automation

India’s GST ecosystem now processes over a billion invoices monthly. At the same time, AI-driven tools helped the government detect Input Tax Credit (ITC) fraud worth Rs 74,782 crore in FY26. Yet, as businesses increasingly embed AI into financial automation, a critical question emerges: what happens when the algorithm misclassifies a transaction, miscalculates GST, or triggers a compliance notice without a clear audit trail?