Indirect tax professionals know there are major changes coming that have a significant impact on the way businesses need to operate to remain compliant. In order to meet the current and upcoming Digital Reporting Requirements, Tax, IT and finance teams need to step up and collaboratively drive changes now.
But it’s also harder than ever to get peoples’ attention. When there are global crises on top of an ever-growing list of corporate priorities, how can finance and tax people get anyone to prioritise what’s happening in indirect tax?
We’ve put together four top tips to help you get your finance and wider business to start thinking about tax and take the necessary steps to get ahead of these major changes.
1. Stop communicating like a tax person. A shift in mindset is necessary. From an indirect tax perspective, you may be motivated to drive change to ensure compliance with the legislative changes coming your way. But while these legal requirements might get people’s attention, you will probably get a more positive reaction by aligning your case with front-line business goals. If you can translate how indirect tax needs benefit your colleagues’ priorities or challenges, you’ll have a much easier story to sell.
For example: Your customer onboarding teams want to improve customer experience and reduce the number of disputes.
How to get tax on the agenda: Explain to the sales or onboarding team that getting the customer’s VAT registration number and inputting it correctly will help ensure that the customer receives correct VAT invoices and this reduces the risk for potential disputes. Without correct VAT registration numbers, your dispute ratio is going to go up.
By aligning priorities with others in the business, you can start driving behaviour change.
2. Get out there and speak to more people in the business. Even if you’re working remotely, it’s important to make an effort to get on calls and have more conversations with key stakeholders in the business. You’ll get a better understanding of what the business priorities are – and raise your profile as well. Use these conversations to identify opportunities to get your message out there and work out how your priorities can benefit business priorities.
Conversations outside your normal day-to-day operations will also keep you more in touch with internal developments. You’ll have a better chance of getting your concerns addressed and aligned at an earlier stage and help prevent indirect tax from becoming an afterthought.
3. Focus on why these changes need to happen. Marketing experts know that to win hearts and minds, you need to communicate WHY you’re doing what you’re doing, not just WHAT needs to be done. If you take a step back, you may find more clarity on how to get through to people. Especially if you want your organisation to anticipate likely legal changes, explaining the why is crucial as it’s not yet a legal obligation.
The details of indirect tax compliance may go over people’s heads, but they are more likely to listen when they understand that your motivations are to avoid multi-million Euro fines, keep people out of jail and keep your company in business.
4. Be patient and persistent. You know your department and your challenges inside out, but it will take a while for people to get their head around your challenges and they will have priorities of their own.
It can also be overwhelming when you need to drive changes to so many processes and systems outside of your typical sphere of influence. But it can be done. Driving change and getting people to take indirect tax concerns more seriously will take patience and persistence. Don’t give up if things don’t go your way immediately.
To get the wider business to start taking indirect tax more seriously, you may need to step away from the legal advisor role and engage into the perspectives of those in the wider business.
Business knowledge combined with your knowledge of the legislative developments will be required to drive real change.
Vertex offer a number of resources to help finance and tax professionals navigate this new landscape, including:
The changing role of the tax function by Peter Boerhof, VAT Director, Vertex;
The key drivers of tax reforms by Prof. Dr. Jeffery Owens, Director, Centre for Tax Policy and Administration, OECD;
The opportunities and challenges of implementing a tax engine, Andrea Spandau, Head of Functional Excellence, Siemens;