How successful indirect tax teams evolve into strategic advisors

Earlier this year, we surveyed 800+ corporate tax professionals and published the findings in our 2021 State of the Corporate Tax Department report. Several key findings emerged in indirect tax. Most notably, 57% of respondents anticipated significant government change in terms of digital filing or real-time reporting, and 80% expected to face serious challenges with people, processes, and technology.

To investigate further, we scheduled in-depth interviews with 30+ tax directors around the world who oversaw their company’s indirect taxes.

Corporate indirect tax teams are over-burdened and under-resourced

The number one concern for most indirect tax managers was the pace and scale of regulatory change. This was especially true for companies operating in multiple jurisdictions with a wide variety of products and services.

Indirect tax teams are under great pressure to ensure compliance with complex tax regimes, even in the midst of frequent regulatory updates, the rise of e-commerce and digital products, and potential mergers and acquisitions. At the same time, they are battling internally with poor data and manual processes that are ill-equipped to meet increasing demands from tax authorities.

Technology and talent are key enablers of a more strategic indirect tax function

Many of the tax directors we interviewed discussed their desire to evolve the indirect tax function into a more strategic role. When asked about their five-year goals, more than 60% planned to increase automation as a way to improve the analysis and reporting they could offer the business.  

Indirect tax teams work with almost every other department in the company. The wealth of data these teams manage can provide unique insight into a company’s supply chain, customer behaviors, and cashflows – that is, only if the data is accessible and reliable. That’s why the right investment in talent and technology is critical for indirect tax teams that want to raise their standing in the broader organization.   

Further topics we explore in our indirect tax report

• Regulatory change
• Digital tax reporting
• Data confidence
• Internal stakeholders  
• Skills gaps
• Software investment
• Implementation tips