Over the past several years, the U.S. federal tax system has undergone an immense change after passage of the Tax Cuts and Jobs Act (P.L.115-97) in 2017 that amended the Internal Revenue Code dramatically. Now with the COVID-19 pandemic, even more changes are emerging at a time when corporate tax departments are having to work remotely, while seeing a surge in their workload and constraints on their resources.
Keeping up with these developments presents a major challenge to the tax chiefs of America’s largest corporations. Already expected by their boards and shareholders to minimize tax liabilities and regulatory risk, in-house tax experts now must battle on multiple fronts as they seek to satisfy both stakeholders and regulators in an ever more complex world.
You can download a copy of the new 2020 Corporate Tax Departments Survey Infographic here.
Technology ought to offer some support, particularly as many companies embark on a program of digital transformation. There are certainly plenty of technological solutions available to the tax profession, but as our research indicates, many of these solutions fail to meet expectations. Indeed, resolving this failure was a major key hurdle for tax teams throughout 2020 and beyond.
The new 2020 Corporate Tax Departments Survey Infographic identifies the main takeaways from the recent 2020 Corporate Tax Departments Survey, that was conducted by Acritas, a Thomson Reuters company, and the Thomson Reuters Institute. Acritas interviewed tax department leaders from 23 large, U.S.-based companies and surveyed more than 300 corporate tax professionals for the report.
Among the main takeaways reflected in the infographic are detecting key challenges and priorities that have emerged for tax departments, such as the day-to-day pressure of compliance with ever-changing tax code, the frustration of dealing with technology that could do so much more if there was sufficient support to make it effective, and dwindling resources to call upon both internally and externally.
Another takeaway explains how tax department professionals feel about their own departments’ ability to leverage technology. More than half of the respondents surveyed said that their department’s approach was “chaotic” or “reactive.” Only a few placed their departments at the top end of the scale.
Finally, the infographic provides insight in how some departments are trying to find talent in a tight labor market for tax specialists and technology experts. When it comes to talent and people, there are different approaches to addressing the skills gap and leading change, the report found. For example, survey respondents noted that there’s a move to develop the new role of tax technologists, a professional that will combine tax knowledge with technology and data skills.
While the data seems clear, the recent report and the new infographic shows that corporate tax departments are embracing approaches to these problems that are much more nuanced than meets the eye.