InPart Iof this Learning Lab, I looked at three areas of artificial intelligence (AI) worthy of attention for the tax office. AI holds great promise for tax, but capitalizing on the technology calls for some careful thought.
Here are seven key questions for tax professionals to consider when thinking about the potential impact of AI technologies:
If there were a way to apply advanced analytics to company financial and transactional data, what tax-relevant patterns might emerge?
What kinds of tax problems could my organization solve using predictive analytics, algorithms or process automation?
What are areas of redundant human activity in the tax lifecycle that could be expedited or digitized through cognitive computing? Could these ultimately be automated through robotic process automation?
If low-value activities could be reduced or eliminated, what higher-order strategy/planning activities and thinking could get more attention and focus?
Are there areas of unknown risk exposure that could be uncovered through data association (identifying connections among data points), clustering (grouping data by similar characteristics) or dimension reduction (efficiently reducing data variables in a particular set)?
What third-party data could be acquired for benchmarking or providing added insight into internal tax data patterns?
How could various forms of AI help close the talent gap and increase the capacity/capability of the current tax staff?
The time to start planning for AI is right now. As Vertex’s John Viglione and David Deputy point out in a recentTax Executive article, “AI’s long development lifecycle has reached a point where its applications are changing rapidly. Given the range and magnitude of its potential influence, companies need to prepare to clear impending hurdles involving people and process.”
Please remember that the Tax Matters provides information for educational purposes, not specific tax or legal advice. Always consult a qualified tax or legal advisor before taking any action based on this information.
John H. Wilson is Director, Global Compliance Technologies. He has more than 20 years of experience in software and services industries. John is responsible for leading client engagement and co-innovations, supporting multinational tax leaders and professionals to address global taxation challenges. He holds a B.S. in marketing from Messiah College, an M.B.A. from The Pennsylvania State University and a Ph.D. in organizational leadership from Regent University.