Recruiter Insights: Transforming tax with technology

about 2 years ago by Phil Smith

Recruiter Insights: Transforming tax with technology

Dark room with computer screen showing a quote Do what is Great.

In this article, Phil Smith, our Tax Manager, discusses how technology is transforming tax functions.

The role of the tax technology function is increasing at an exponential rate, with tax executives having to bridge the gap between technologist and tax experts. As technology transforms the way we live, the way we work must change and for tax, this new way of working isn’t just different, but better. Tax authorities are under pressure to do more with less, whilst closing the gap in revenue caused by non-compliance, evasion, fraud and non-collection.

The introduction of tech systems has become a widely-recognised response to these problems, with Tim Steel, Tax Markets Leader at EY, writing “digital technology transformation is the single biggest disruptor in the tax profession”. Whilst tax specialists with little experience in tech may be feeling the pressure to upgrade their own systems, tech in tax has presented us with new levels of transparency, which were simply not achievable in the past.

New technology such as AI, RPA and Blockchain can offer new levels of visibility, with Blockchain making fraud and errors far easier to detect, as the system provides clear information about transactions and items in the network. In Russia, taxpayers are required to submit VAT transactional data along with their electronic VAT returns.

An action which saw domestic VAT revenues increase by 12% in the very first year it was implemented. TaxBots are already being used to transform tax functions, making tax returns much easier for the layperson to wrap their head around, meaning accidental under or overpayments are slowly becoming a feature of the past.

Predictive analytics have meant tax fraud is becoming a much trickier game to play.