Tax Associate
Digitalisation has brought about many changes in tax. For example, tax data has become more granular, volume of transactions has increased, and businesses have become more globalised. To keep up with these changes, the tax function has to evolve to manage bigger and more complex data at a faster rate.
Key Trends in Tax1
Digitisation of the tax function
Tax leaders are seeing digitalisation deliver exponential growth in speed and performance. Tax functions are seeking ways to make sense of big data that is increasingly available to them. They are also developing new standards of integrating process automation and augmented intelligence into day-to-day operations. Open networks have also allowed for greater transparency between tax functions and authorities to facilitate collaboration.
Evolution of tax authorities
Tax authorities are pushing for businesses to provide real-time reporting of data and greater integration with other government bodies such as the Immigrations and Checkpoints Authority (ICA) and the Accounting and Corporate Regulatory Authority (ACRA). Data management is moving upstream.
Apart from national-level regulations, tax associates also have to comply with international tax reforms. The digitisation of businesses has brought the world closer and opened new opportunities for businesses to meet the needs of the global market. As such, international authorities such as the Organisation for Economic Co-operation and Development (OECD) and G20 have called for new international tax architecture to unify global taxations.
Disruptions to global trade
Recent global shifts have resulted in governments looking to increase trade partnerships in Asia. For example, Asia-Pacific is looking to increase trade partnerships in Asia instead of looking to the US as the primary trading partner. Asia-Pacific has seen its largest free trade agreement (FTA) with the Regional, Comprehensive Economic Partnership. The EU has also entered into a FTA with Japan, Vietnam and Singapore in recent years.
These partnerships would require tax functions to remain agile to optimise organisations’ books to capitalise on global trade negotiations.
For more details on trends in the tax function, refer to the Jobs Transformation Maps for Accounting Practices and In-House Finance and Accounting Functions here
Biggest Challenges in Tax Accounting
According to a 2019 survey by Bloomberg Tax and Accounting for Corporate Tax Professionals2, the top challenges highlighted by leaders include keeping up with tax reforms, managing overall compliance burdens, data management (collection and processing), and technology implementation and maximisation.
What does this mean for professionals?
Tax companies need to provide services that are:
Agile
With digitalisation, the scale and pace at which businesses operate can increase exponentially. Tax accountants need to be able to keep up with the increasing volume of transactions being made. Tax functions also need to actively anticipate the effects of regulations and partnerships happening globally.
Insightful
Tax services need to find new ways to maximise increasingly granular data that is becoming increasingly granular and capitalise on new technologies that help process and analyse data in a visual way.
Strategic
Tax leaders need to continuously look for ways to reduce their manual activities and shift resources to create more value-added services. Tax functions also have to consider how they can move further upstream in their data sources and ERP systems to manage their initial data entry of data. Controls need to be more preventative and automated.
