Estonia’s embarrassment over AI The sentence that started the whole thing was wrong.
The Riigikogu (Estonia’s Parliament) passed, in December, changes to its Gambling Tax Act that would lower tax rates on remote gambling. However, the language of the law only referred to “skill games” For that year not remote gambling or games of chance. Estonia’s entire gambling industry is worth around €300 million ($343 million), and its online gambling market is one of the fastest growing in the EU.
The mistake was so serious that the online casino industry was left untaxed for an entire tax year. losing the government €24 million ($27.4 million) A year’s gambling revenue
Legal counsel of a gambling operator spotted the mistake. The embarrassment was heightened when Luukas Illes, the former Undersecretary of Digital Transformation, ran the law through Claude & Gemini. Ilves stated that the AI systems quickly identified inconsistencies.
Within hours, Ilves had built a prototype tool—called Apsakaleidja, or “Fuckup Finder”—that could pull draft bills from the Riigikogu website and flag problems such as broken references, contradictory wording, arithmetic errors, and impossible dates. It categorizes the problems as high, medium, or low risk—of the 112 bills currently listed, 102 are rated high risk. One example highlighted On the Fuckup Finder, contradictory language is suggested in draft text. Ilves even demo’d it on national TVTo the host’s surprise,
The blunder was embarrassing—but also triggered a revelation within the government. “The situation demonstrated that AI can be an incredibly useful assistant,” Kristen Michal says that Estonia’s Prime Minister. “And—in the form of a vibe-coded platform to check draft legislation created in response to the incident—we saw an example of how agentic tools can empower civil society and individual citizens.”
Estonia is doubling down on AI use in the government. In January, Michal suggested The country could use the Apsakaleidja tool to draft laws to find and correct loopholes before they occur. He was launched the Eesti.ai program The goal is to increase productivity in Estonians by 2035. Bolt’s Markus Villig, and Ilves (creator of Fuckup Finder) are among the advisors for the Eesti.ai project.
Next, we have April. the country’s parliament received from the government In a recent bill, the state and local government was given the authority to use AI to automate processes. The bill, currently in parliament for deliberation, is a step towards becoming law. In June, Michal told an Eesti.ai If everything goes according to plan, you will be able to meet that deadline. “Estonia will become the first country in the world to create official digital identities for AI agents.”
“This is a new environment for the public sector,” Michal tells WIRED. “It demands agility and the ability to adapt as technology changes.” Michal believes that Estonia has a better chance of adapting to these changes than other countries. It is a leader in integrating digital identities thanks to its digital-first approach, and 99 percent public services are now online. Estonia is held up as an example of how to run a modern digital state—as WIRED first covered a decade ago. This laid the foundation for AI adoption to be easier. “Those investments now allow us to move faster and more confidently into the AI era,” The man explains.
Catherine Flick of the University of Staffordshire who studies technology ethics says that the error in gambling taxes raises an even more fundamental question. “Why are humans not doing this review process as part of the legislation drafting procedure?” She says “At some point someone has to sit down and read through the whole thing, with the understanding of the context and all that sort of stuff, in order to make sure that this is a decent law.”
