BrazilPwC points to priorities for the future of tech-enabled tax functions
PwC has examined the future tax function landscape in the Middle East, identifying six priority areas for regional businesses.
Perhaps less glamorous terrain for applications than elsewhere, the tax function will nevertheless be revolutionised by the advent of emerging digital technologies in areas such as data analytics and Robotic Process Automation (RPA). A new report from PwC – “Six priorities for your tax agenda: Tax function of the future 2019/20” – has delved into what this means for businesses in the Middle East, concluding with recommendations for the key priorities to address.
“The tax and shadow tax function and professional of the future will have to be more data savvy,” said PwC Middle East Tax Partner Mark Schofield at a series of launch events, which brought together representatives from more than fifty organisations. “There is a fantastic opportunity to further leverage data analytics within tax functions for greater contributions to the bottom line and we are so excited to be bringing these opportunities to our clients right now.”
Leading the list of priorities is the need for businesses to adapt and be ready for tax policy changes – a particular of issue of note in the Gulf, where Bahrain became the third GCC state following the UAE and Saudi Arabia to roll out the region-wide VAT scheme at the beginning of the year. Global management consultancy Oliver Wyman has meanwhile suggested the GCC states will need to overhaul their taxation regimes to meet a $2 trillion budget black-hole by 2030.
“The continuously developing tax landscape in the UAE demonstrates the need for organisations to have a strong tax function that is in tune with, and well-connected to the broader business,” said Schofield. “This is critical for the long-term success of companies to ensure that they are agile and able to respond to any tax developments or requirements imposed upon them.” Adapting internal systems and processes using the latest in technology, PwC adds, will be key to achieving this agility.
At the launch events – or ‘digital breakfasts’ – digital tax experts from PwC showcased the cutting edge and emerging technologies currently available for tax professionals, including RPA, data analytics and visualisation tools, as well as data management and compliance-enabling technologies – designed for businesses to improve, streamline and ultimately strengthen their tax management. “Data is at the heart of tax and business strategic decision making,” says Schofield.
He continues; “Now, more than ever, companies will need to be able to quickly access data and models for decision making and planning for potentially complex and overlapping rules, as well as meeting multiple compliance obligations. Going forward, tax and shadow tax functions need to be connected with their businesses from a governance, legal, strategic and technology perspective. These are critical touch points that demand a collaborative rather than reactive approach.”
Elsewhere, the report suggests embracing ‘small automation’ as a first step – using new data analytics and extraction tools designed to automate repetitive tasks such as reporting requirements, VAT exception testing, and invoice processing – while up-skilling employees is described as ‘mission critical’. The remaining priorities include aligning with customs and trade, challenging the traditional tax function operating structure, and recognising the benefits of AI in tax and finance functions.
