At a glance
- Government launched trial of new GOV.UK Chat, a generative AI-powered chatbot
- The chatbot aims to help small businesses and individuals find information more efficiently
- The government could consider expanding the chatbot to simplify tax advice, especially about MTD
- However, it’s important to work out the teething problems first, such as AI hallucinations
It’s the next big thing in customer service, and now the UK government is trialling a new artificial intelligence (AI) powered chatbot – GOV.UK Chat – to support users in accessing information about business rules and support.
GOV.UK Chat is a generative chatbot designed to allow users quick, personalised answers to their questions based on UK government guidance for the first time. It aims to simplify the process of finding relevant advice and provide clear and concise answers by summarising content from multiple pages.
The government believes that the generative AI employed by its chatbot could make it easier for people to find answers from the 700,000+ pages of the GOV.UK website.
Chatbot trial a success so far – but tax advice needed
The government has been running a series of experiments to test the technology’s viability. At the start of 2024 it shared its early findings which revealed that nearly 70% of users found the responses were useful, and just under 65% of users were satisfied with the experience.
The next phase of testing began at the end of November 2024 and has allowed up to 15,000 people to ask the tool for advice on business rules and support. The chatbot is now linked from 30 of GOV.UK’s business pages, such as ‘set up a business’, and people with access to the trial can ask questions about tax and the support available to them. Results of this testing phase will then be published on the Inside Gov UK blog.
Ben Lee, Partner in the Web3 and Disruptive Technology department at Andersen LLP, says that while the chatbot trial is a good start from the government, as a next step it will be important to zero in on what will be most helpful for those looking for advice.
Lee’s sources indicate the bot is coping well with queries regarding regulations, but cannot provide any tax advice.
Lee says: “At a time when businesses are facing serious lags in operations as a result of delayed PAYE, VAT registrations, or general communication with HMRC, a tool that would help businesses expedite the specific answers they require – which could be implemented in Government Gateway accounts – is a more crucial need than a bot that simplifies existing guidance.”
Tackling tax complexity should be a future focus
A common complaint among businesses has historically been the lack of simplicity in HMRC’s systems, particularly among small and medium sized businesses. HMRC’s latest statistics show that the tax gap from small businesses takes a 60% share in 2022 to 2023, increasing over the last 5 years from 44% of the overall tax gap in 2018 to 2019.
One specific example of this complexity in taxation is the Making Tax Digital (MTD) initiative, HMRC’s plan to digitise the tax system for VAT, Income Tax self-assessment, and business Corporation Tax. MTD is designed to make tax administration more effective and efficient and simplify the process for individual and business taxpayers to make it easier for them to get their tax right.
A good idea in theory, the rollout of MTD has faced delays and shifting deadlines, and businesses have complained of a lack of clarity on its requirements and timelines for businesses of different sizes. Many taxpayers also struggle with understanding the software needs and reporting changes, leading to frustration about the initiative.
In its next chatbot phase, there is an opportunity for the government to zero in on problem areas like MTD, working closely with HMRC to provide actionable advice and information to small businesses. Solving the MTD complexity problem could spur real change, allowing small businesses to meet their obligations and start to close the tax gap.
What’s next for the GOV.UK chatbot?
For Lee, the next logical step is to increase test users of the platform. “These models rely on large amounts of data to refine output – for reference, ChatGPT has 100 million users a day. If [the] GOV.UK [chatbot] proves a success, it would be logical for a similar tool for HMRC guidance to be implemented, but it is unlikely we will see this in the next two years.”
However, he warns that with any AI model, the risk of ‘hallucinations’ needs to be understood. AI hallucination arises when an AI chatbot perceives patterns or objects that don’t exist or are indiscernible to human observers. This can create inaccurate outputs.
Lee explains: “Developers are trying to reduce the 1% of hallucinations where the model is displaying unusual behaviour (e.g. aggressive language), but it remains to be seen where liability lies if the model provides incorrect information that is then acted upon.”
The GOV.UK chatbot trial has been a promising step in improving communication about certain government services. Any new initiative will experience teething problems, but the lessons learned from these trials will pave the way for more effective AI-powered tools in future. Expansion of the chatbot into areas like HMRC could spur on efforts to close the tax gap over time.
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