Technology has long been a crucial piece of tax operations. But today, the emergence of a new class of innovations that can automate and augment human work is reshaping how the business of tax gets done. At KPMG, we categorize these powerful and exciting technological developments under the umbrella term, ‘intelligent automation’.
With goals to ramp up analytic capabilities, streamline processes, reduce headcount, cut down on manual errors or achieve a host of other potential benefits, many tax departments are embracing intelligent automation tools with increasing speed.
Automation capabilities are being applied in a variety of areas. Some tax teams leverage software bots to clean up and consolidate data from multiple systems and automatically build returns and send payment requests. Others implement automation tools to streamline the indirect tax compliance process or to reduce the work demands of year-end processes by taking over manual tasks, such as loading data into tax software. Many CTOs see a big opportunity to implement automation in developing countries, where tax compliancedemands have increased but there is a lack of skilled workers to accurately complete the necessary work.
Approaches to the automation strategies vary. Some CTOs opt to implement a single piece of enterprise-level software. Others leverage a spectrum of laptopbased automation tools that allow tax professionals to create their own microautomations. And still more outsource low-level compliance work to robotics groups in other functions, rather than developing the same capabilities in the tax department.
Securing funding for technology projects, including process automation, is an ongoing challenge for tax leaders. Investment in projects is often determined by two factors: 1) budget constraints and 2) how the value of tax is measured by the CFO and CEO. Many CTOs say they have a leg up in budget discussions because their technology spend requests often pale in comparison to those other departments, while the expected return on investment is far greater.
Secondly, tax executives often face staffing challenges as the department gains new technologies. The tax professional role has evolved in the digital age. The best tax people today are those who are proficient in both tax and technology — and not just one technology, but working with a variety of tools that can change on a dime. It’s a rare combination. Finding formally trained tax technologists in the job market is difficult given the high level of competition for these resources. And existing employees may have deep knowledge in one category but require training the other.
Tomorrow’s tax teams will clearly look much different than today’s. Tax leaders will need to carefully assess what skills the department will need in the future and how best to build a team that can truly add value.
— What are the most compelling intelligent automation use cases in your tax department?
— What technological, organizational or people hurdles do you face to put intelligent automation to work?
— What are the risks to the organization of not implementing intelligent automation in tax?