2023 Future of Tax Transformation Whitepaper

IT and tax teams have long operated in separate lanes. IT focuses on revenue-driving projects. Tax focuses on compliance. The result? Tax teams are often left out of key technology decisions until after the fact, creating risk and missed opportunity.

Why this gap is costly

When tax professionals aren't involved early, businesses can face unexpected exposures. A purchasing department issues a purchase order for equipment but forgets to factor in indirect taxes. A company opens satellite offices without analyzing local tax obligations. These gaps don't just create budget overruns. They can trigger audits, disputes, and penalties.

With more than 19,000 different sales and use tax rates worldwide, the complexity only grows. Tax regulations change constantly. In July 2021 alone, 36 new district taxes and 22 new city taxes were levied in the United States. Managing this manually is no longer realistic for most organizations.

The strategic value of tax automation

Tax teams spend a significant amount of time gathering data, running reports, and calculating adjustments. Automation can free them from those repetitive tasks and shift their focus toward delivering insights that actually save the company money.

Bringing a robust tax automation engine into your ERP environment can improve data transparency and give tax professionals the tools to support strategic decisions, not just fill out compliance forms. The tax leader's role can evolve from cost center to strategic contributor.

What alignment looks like in practice

Getting there requires both sides to engage. Tax teams need to educate IT on what they do, why it matters, and what data and reporting capabilities they need to operate effectively. IT needs to understand how tax data is aggregated and transformed, and how to deliver it in formats that reduce errors and save time.

Tax departments should also maintain a technology roadmap that accounts for regulatory requirements, software licensing, and anticipated changes in the tax landscape. Senior IT and tax leaders should meet regularly and both should have a seat at the table when technology decisions are made.

Reducing audit risk through better collaboration

A disciplined, well-equipped tax organization can reduce audit risk exposure by automating basic reporting tasks and ensuring transactions are properly documented. When companies move toward next-generation ERP systems, building in tax automation from the start (rather than bolting it on later) positions them to stay compliant, manage risk, and scale with confidence.

This white paper, developed with insights from Deloitte Tax LLP and SAP Signavio, makes the case for why IT and tax alignment isn't just a good idea. It's a business imperative.