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Tax transformation ?
In the finance context , digital-led change is also having an increasing impact on the way organisations , teams and professionals operate . It ’ s interesting to note , however , that because tax is often viewed as a function of the wider finance operation , it isn ’ t always given the consideration it deserves when leaders plan their transformation strategies and investments .
The challenge this approach can create is that , even though the general complexity of the tax function means technology is usually more widely used compared to other finance functions , it is being left behind . In the rush to digitally transform , organisations are at risk of missing out on a range of opportunities to significantly improve the way they approach tax .
A big consideration driving this is that , unlike other areas of finance which have operational and revenue increasing priorities that can directly impact a business ’ bottom line , tax is driven by regulatory compliance . This can mean that businesses are less willing to invest above and beyond what is necessary .
Bruce Martin , CEO of Tax Systems
Its status is somewhat analogous to the emphasis often given to Environmental , Social and Governance ( ESG ) planning and implementation , where organisations will implement change to a minimum standard until regulation prompts a greater sense of urgency .
The pace of digitalisation for tax teams can also be driven by factors like their specific position in the finance and tax lifecycle , and the experience and skill set of the tax team , including their influence on boardroom conversations about technology strategy and budget allocations for Digital Transformation priorities .
It ’ s not uncommon , for example , for CFOs with accounting backgrounds ( as opposed to tax ) to focus on the potential for transforming areas that align with their experience and role . The net result of these influencing factors is that tax is some way down the list of priorities and – in many organisations – less likely to see the benefits that Digital Transformation has to offer .
Companies could be losing out on a range of opportunities , including boosting efficiency and the levels of insight their teams can apply . Indeed , if the tax function is viewed as an exercise in compliance , it is unlikely that technology investment will be channelled towards anything resembling tax innovation .
Keeping pace with the speed of change
The question to ask here , of course , is what can be achieved given the right levels of emphasis and investment ? Fundamentally , delivering tax transformation is all about empowering tax professionals to focus on adding value and making a bigger strategic impact .
Experienced professionals are being freed from the more mundane aspects of their work , so they can concentrate on areas more attuned to their years of experience and training . By applying automation to handle a range of manual and predictable tasks , tax professionals have more time to focus on areas such as improving efficiency and evaluating tax strategy . This is not only beneficial for them on a professional level but can also deliver a measurable impact on the business as a whole .
AI has huge potential to add value to the processes and capabilities of tax teams everywhere . And while it ’ s understandable that tax professionals may be reticent
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