Artificial intelligence will also transform taxation

According to the research, which involved a total of 1,600 decision-makers, tax departments are currently facing unprecedented geopolitical tensions, regulatory pressure and difficulties arising from a labor shortage. For eight in ten respondents, the introduction of a global minimum tax is the biggest legislative challenge, which they believe will increase their overall tax burden. However, only a fraction of them feel fully prepared to meet the related reporting obligations. According to the majority of respondents, the coordinated management of data and AI could bring about a real breakthrough in taxation, but just over half of respondents have a viable long-term plan to achieve this.

The research participants also believe that new technology can greatly contribute to alleviating the increasingly pressing labor shortage. According to almost two-thirds of respondents, the retirement of experienced tax professionals will have a significant impact on their daily operations. Many fear that the declining number of starting accountants will make it more difficult to replace the lost knowledge. Professionals currently spend more than half of their working time on routine tasks, but with the help of AI, they could more than double the time spent on strategic activities that require comprehensive industry knowledge.

“Artificial intelligence is not a magic bullet in itself, as it creates real value only when trained professionals use its capabilities for well-defined purposes using structured data and well-thought-out operating models. Companies that invest time and money now in transforming their tax and finance functions can gain a serious competitive advantage. The question now is whether companies are willing to make decisions quickly and boldly enough to not only follow but also shape market changes”

– highlighted András Módos, Head of EY’s Tax and Legal Services business.

Respondents are currently developing teams with AI capabilities in line with market expectations. Retraining existing staff is considered the most important task at almost all companies, with nearly three-quarters of respondents also recruiting data scientists and tax technology experts, and eight out of ten also relying on external experts. Companies need professionals who understand taxation, data analysis, technology, and are also able to participate in the transformation of the organization.