The Futures - No. 72
Tax agencies using AI / The US-Mexico partnership / Ozempic slowing aging
In this issue
The Quantumrun team shares actionable trend insights about tax agencies using AI to target wealthy tax evaders, the increasingly intertwined economies of the US and Mexico, Ozempic’s anti-aging properties, and more human jobs lost to AI.
Future signals to watch
Researchers suggest that semaglutide (Ozempic), a drug for Type 2 diabetes and obesity, may also slow aging. Studies indicate it could treat illnesses like heart failure, arthritis, Alzheimer's, and cancer.
A New York office tower is the first to use the Ozmo automated window cleaning system, featuring robots with sensors and AI that clean windows three times faster than human crews.
The National Institute of Standards and Technology announced a collaboration between the US AI Safety Institute, Anthropic, and OpenAI to enhance AI safety research, including early access to new models for joint safety evaluations.
Swiss food scientists have developed a method to make chocolate using the entire cocoa fruit, including pulp, juice, and husk, without added sugar, appealing to sustainable food companies.
The Biden administration has finalized a plan to expand solar energy development on federal lands in 11 western states, supporting the goal of 100% clean electricity by 2035.
Researchers at ETH Zurich have improved DNA-encoded chemical libraries (DEL) technology, enabling the automated synthesis and testing of billions of drug molecules within weeks.
UC Berkeley researchers have developed a process to vaporize plastics into hydrocarbon gases, enabling them to be recycled into new plastics for a circular economy.
Klarna, a Swedish financial services firm, plans to cut nearly 2,000 more jobs as AI automation grows. This follows a reduction of over 1,000 employees in 2023, bringing its workforce down from around 5,000 to 3,800.
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Culturally // Trending
YouTube → Terrifier 3 // X → The AO3 meltdown // Reddit → Owlette’s hydration routine // TikTok → Over-The-Top Hopecore // Instagram → Levi’s celebrating the Oasis reunion // Spotify → “Wrong Ones”
💰 AI is changing the game for tax agencies
Next generation artificial intelligence (AI) systems is increasingly being used in tax collection as tax agencies seek to close the significant “tax gap” (the difference between taxes owed and paid). For example, the US Internal Revenue Service (IRS) has begun using AI and machine learning to detect tax violations among high-income earners and large business partnerships.
The IRS opened investigations into 75 of the largest partnerships in the US (each with more than $10 billion in assets). The agency is using AI tools to identify potential tax cheats, particularly in hedge funds and real estate investment partnerships. By targeting the wealthiest taxpayers, who collectively owe hundreds of millions in back taxes, the agency hopes to increase federal revenue over the next decade.
Tax agencies globally are exploring similar technologies to enhance productivity and improve taxpayer services as AI becomes more accessible and effective for complex data analysis. For example, IBM's research shows that AI tools can detect tax scams more effectively and help citizens access benefits more quickly by automating customer service functions. These developments suggest that AI’s role in tax administration is poised to grow, helping agencies address the increasing complexity of tax laws and the surge in digital tax filings.
Looking ahead, AI offers the potential to significantly reduce the tax gap, which was estimated to be $688 billion in 2021 (in the US, the latest data available), by improving audit accuracy.
However, integrating AI into tax systems poses challenges, including concerns about data privacy, ethical use, and the risk of biases against marginalized groups. As AI becomes more deeply embedded in tax administration, countries will need to develop tailored risk management strategies that account for their unique tax policies and public perceptions.
US Tax Gap, 2014-2021
Actionable trend insights as tax agencies use AI tools:
For entrepreneurs
Entrepreneurs can develop AI-powered accounting tools designed specifically for small businesses and freelancers. These tools can analyze financial transactions, detect anomalies, and provide real-time alerts for potential audit triggers.
Likewise, they can create consultancies that help small and mid-sized accounting firms implement next-gen AI tools and processes into the services they offer clients.
For corporate innovators
Finance and insurance companies can develop AI-enhanced risk management services that predict potential tax compliance issues within large organizations or investment portfolios.
For example, a corporation could partner with tax agencies to gain insights into AI algorithms used for audits and then develop proprietary models that help their clients anticipate and mitigate audit risks.
Companies can invest in sustainability initiatives that qualify for tax credits.
For instance, a corporation could partner with environmental organizations to develop AI tools that measure and report carbon offsets from various sustainability projects.
For public sector innovators
Governments can establish AI-powered compliance training centers in collaboration with private tax consulting firms and AI developers. These centers could offer training programs to educate tax professionals, accountants, and business owners on new AI-driven tax compliance requirements.
They can form AI advisory boards that include a mix of experts, tax professionals, and citizen representatives to oversee the use of AI in tax administration. These boards could provide recommendations on ethical AI usage, propose safeguards to protect taxpayer data, and advocate for transparency in AI audit selection criteria.
Trending research reports from the World Wide Web
The 3Q 2024 Global PV Market Outlook forecasts a revised global solar PV capacity addition of 592GW in 2024, up 33% from the previous year.
Cell and gene therapy developers have raised $500 million across 16 rounds this year, significantly below the 2021 peak of $8.2 billion across 121 deals.
JD Power's forecast highlights the unpredictability in the EV market due to varied vehicle offerings, a rise in leasing, and ongoing consumer concerns about charging infrastructure, with hybrids increasingly competing against battery-electric vehicles.
Precision fermentation is being forecast to potentially turn the world vegan, as it can program microorganisms to produce proteins, enzymes, and fats identical to those in animal products for food production.
Global birth rates are declining below replacement levels, except in Sub-Saharan Africa, with Asian countries experiencing especially low fertility rates.
🇺🇲 🇲🇽 US and Mexico are becoming reliant on each other
The partnership between the US and Mexican economies is to become even more profound over the years to come, driven by geopolitical shifts and economic strategies like nearshoring. The decline of China’s economy, marked by demographic challenges and political instability, has prompted US businesses to look closer to home for manufacturing partnerships.
Mexico, with its proximity and established trade frameworks—like the North American Free Trade Agreement (NAFTA) and the United States-Mexico-Canada Agreement (USMCA)—has become a prime alternative. Mexico is now the US' largest trading partner, surpassing China and reflecting a deepening economic bond that integrates their supply chains and labor markets. In addition, Mexican immigrants in the US sent $61 billion in remittances back home in 2023, an amount comparable to Myanmar's entire GDP.
However, while the Texas-Northern Mexico corridor has developed into one of the largest industrial zones globally, the integration needs to expand. The US will gravitate toward a strategic shift that connects broader US regions with the greater Mexico City area and southern Mexican states, which collectively hosts one of the world's largest untapped workforces.
Such an effort would require significant infrastructure investment, particularly by enhancing US rail connectivity to both Northern and Sourthern Mexico to handle bulk goods more efficiently. Such investment would dramatically expand the existing transport network, boosting the economies on both sides of the border.
If successfully implemented, this deeper integration could solidify North America's economic dominance and self-sufficiency by combining Mexico's young labor pool and manufacturing capabilities with the US' technological and capital resources. This partnership could also stabilize regional economies by creating millions of jobs and fostering economic resilience amid global uncertainties.
Actionable trend insights as the US and Mexico economies increasingly become intertwined:
For corporate innovators
Companies can capitalize on the need for improved rail infrastructure between the US and Mexico by investing in integrated logistics networks that connect deeper into both countries.
For example, a firm could develop a dedicated rail corridor that includes warehousing, distribution centers, and logistics technology to manage cargo efficiently from central and southern Mexico to the Midwest US.
They can establish co-manufacturing partnerships to produce goods designed for a circular economy, targeting high-value materials like recycled plastics or sustainable textiles. A US-based company could partner with Mexican factories to create a closed-loop production system, where waste materials from US plants are shipped to Mexico, processed into new products, and then redistributed back to the US market.
For public sector innovators
Local governments can develop cross-border renewable energy zones that leverage the unique geographical advantages of regions along the US-Mexico border. They could collaborate to create large-scale solar and wind farms in areas with high sun and wind potential, like the Sonoran Desert, to supply power to both countries.
To promote sustainable infrastructure development that benefits both countries, the US and Mexico governments could introduce tax incentives for joint projects that enhance economic integration.
For example, both governments could offer tax breaks to companies that invest in building and maintaining cross-border green transportation corridors or water management systems.
Outside curiosities
"Transformers One" will be the first film using Barco's new HDR laser projectors, launching a pre-release program for the company's advanced theater systems.
Workers are now wearing high-tech ice packs.
X is launching a video conference tool.
This Nike-Museum of Modern Art (MoMA) socks collab.
Ikea Singapore redesigned the store’s big blue bag into a pillow.
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What are the potential ethical and privacy concerns surrounding tax agencies using AI to target wealthy tax evaders, and how can governments ensure fairness and transparency in this process?