I don't trust the AI with micromanagement. It does a terrible job at that. I only leave it to manage my taxes. However I've noted that sometimes the AI lowers tax rates to low even though my loyalty on v high is 150%. My guess is that the AI is trying to promote population growth, which I don't really want as my population will grow too fast. I'd prefer to turn off automatic taxation in this scenario but it's not practical if I have a large empire to manage.