The use of data is permeating almost every aspect of business and the tax function is no exception. Although it is one of the oldest specialisms, tax professionals are having to adjust to the new digital era or risk being unable to meet the regulatory demands of the future.
What is the impact on organisations?
It’s not just technology that is forcing the tax sector to evolve. As governments become more dependent on tax regulation and compliance in creating transparency in the market, control frameworks in place within a business to ensure it is able to continuously transform alongside shifting regulatory requirements is a must.
Businesses are looking to implement initiatives that will enable their tax departments to embrace new technology, leading to levels of higher efficiency and ensuring the department generates more value for an organisation.
However one thing potentially holding the implementation of “Tax Tech” back across more businesses is the support required from other business departments, including finance, accounts and IT. Data collection and reporting needs to be co-ordinated between all departments if a “Tax Tech” strategy is to prove effective.
But with continual transformation required, receiving backing from the wider business can be hard. Heads of tax departments need to engage with overall company leadership and commit to evolving the tax function with a focus on how such an investment will align tax with overall business priorities.
Tax departments will need to ensure specialised tech is seen as a strategic asset for the company, and not just a compliance centre function. The technology being touted to deliver such results include: data integration & ERP solutions; document management systems; tax portals; automated workflow processes; reporting & forecasting tools; and data warehouse applications.
Such solutions will help with the collation of data from invoices, purchases, existing spreadsheets and other sources of tax-related information into a single system, automating the process and making it more transparent and far more accurate.
What is the impact on current employees?
The tax profession is shifting from the manual processes of the past that allowed for numerous errors to slip under the radar, to a more tech-focused department with tech-savvy professionals at the helm. In the marketing departments of small and large-sized businesses, data and technology are being used to analyse and inform marketing strategies; the gap between tax and tech is also being bridged and soon data will be utilised to inform tax strategies, too.
In fact, PwC recently conducted a survey on companies’ use of “Tax Tech”. It was found that while most of the executives questioned agreed that Tax Technology was key to better quality processes and more efficiency from the department, 77% had no strategy in place to invest in such services and 75% had no role available for dedicated Tax Tech specialists.
As a result, tax departments are now suffering from a skills gap. The role of tax professionals in the future will focus on data analysis and creating tax strategies that can save a company money; such skills will be more sought after in the long-run than those with straight finance experience.
What does this mean for future tax professionals?
Existing professionals will need to educate themselves in data analysis and those entering the field will need to be able to prove they can add value by demonstrating skills and experience from different business functions; namely tax, IT and an ability to think strategically.
Larger multi-national companies are already seeking tax candidates with a broad range of skills, and it seems that smaller businesses will be following suit shortly as investment in “Tax Tech” becomes more of a priority.
Tax obligations – for both the public and businesses – will arguably never die and therefore candidates’ skills will need to change. If you’d like to learn more about current tax opportunities and how to leverage your skills for the future, get in contact with DSJ Global today.