Global Tax Management 2023 – Benchmark Report

Compliance complexity takes the top spot

For the first time in this annual SAPinsider study, growing complexity in compliance management, governance, and regulations ranked as the number one driver for global tax management strategy, cited by 35% of the 128 SAP professionals surveyed. Digital transformation remained a close second at 32%, reflecting how tightly linked technology and compliance have become.

Corporate income tax leads regulatory concerns

Corporate income tax compliance jumped to the top regulatory priority in 2023, with 47% of respondents identifying it as a key concern. Much of this shift traces back to the OECD's Pillar Two global minimum tax plan. Even U.S.-based companies without domestic Pillar Two legislation face reporting obligations in countries that have adopted it, raising the risk of double taxation and demanding proactive preparation ahead of the 2024–2025 implementation window.

Indirect tax automation is paying off

Sales and use tax (44%) and VAT/GST compliance (42%) remain consistent workload drivers, but the data suggests automation is helping. Cloud-based tax management adoption grew from 6% in 2021 to 25% in 2023, and the share of organizations with no migration plans dropped by half. A quarter of respondents now use a third-party tax engine for indirect tax compliance. For the third consecutive year, Vertex ranked first for both sales and use tax and VAT/GST determination among those engines.

Control and governance is the new top pain point

This year, respondents ranked control and governance challenges above ERP integration for the first time. This is a sign that organizations are feeling the weight of real-time reporting mandates, data integrity demands, and intensified enforcement from global tax authorities. Managing disparate data sources, updating systems to meet new regulations, and ensuring accuracy across transactional platforms all contribute to this pressure.

Three actions worth prioritizing

The research points to a clear set of recommended actions for SAP organizations. First, use SAP S/4HANA as a centralized data foundation to reduce manual processing errors. Second, invest in advanced analytics and reporting tools to strengthen tax controls and surface compliance risks early. Third, work with SAP-certified tax partners like Vertex, whose tax determination solution is built on SAP BTP and certified through the SAP Integration and Certification Center, to simplify integration and manage indirect tax at scale.

Bring tax leaders in early

One consistent theme across three years of research: organizations that engage tax experts early in ERP migration and transformation projects are better positioned for compliance success. The data shows growing collaboration between tax teams and business leaders. This report makes a strong case for why that coordination should start at the strategy phase, not the implementation phase.