8 minute read 1 Jun 2022

The skills required from tax professionals have changed, driven by the transformation of the tax function and an evolving employment market.

Transformation is redefining the skillset of tax teams

How transformation is redefining the skillset of the tax professional

By EY Romania

Multidisciplinary professional services organization

8 minute read 1 Jun 2022
Related topics Tax

The skills required from tax professionals have changed, driven by the transformation of the tax function and an evolving employment market.

In brief
  • A rapidly-changing tax landscape means tax professionals now require a broader set of skills, such as leveraging technology for data analysis.
  • Tax professionals skilled in data analysis and capable of harnessing technology at speed will be able to guide the C-suite in their strategic decision-making.
  • As the race for talent intensifies, companies must deliver both opportunities and training to recruit and retain tax practitioners with sought-after skills.

For a long time, the conventional skillset of tax compliance and reporting professionals remained relatively unchanged. Beyond the attention to detail required to record data accurately, the primary requirement was for deep tax knowledge and the ability to navigate, analyze and apply a myriad of complex rules and calculate and file tax returns in a timely fashion. Yet the rapid evolution of the tax world in recent years means that the profession now faces a new skills reality it must consider.

The diverse challenges driving this change have been well documented: 

  • A relentless flow of new regulatory demands
  • Acute governmental, press and public scrutiny of tax matters
  • Calls from the C-suite for greater insight from tax teams
  • The pressure to achieve more with less
  • The rise of data management, technology and real-time reporting
  • Today’s unique working environment, impacted by factors such as COVID-19, political tensions and rising inflation

As such, tax functions have had to transform themselves into future-proofed units capable of delivering control, insight and a sustainable competitive advantage to the business.

Tax functions, therefore, need to address how this influences the skillsets now required among their teams. While a strong tax technical foundation remains a must, there is now a need for tax professionals to have a practical aptitude for bringing technology and data solutions to bear on their work — whether that means using robotics to automate repetitive tasks or creating fresh value for leadership and customers through tax data analytics.

Business and Tax Transformation mean the way we understand compliance has shifted from simply entering data into a dashboard to analyzing the return. Cultural awareness and a global mindset to create efficiencies and process improvements is a must.

“The people we hire into compliance and reporting now are far more technology literate and inquisitive,” says Ben Smith, EY Global Deputy Compliance and Reporting Leader. “It's the ability to look at something and ask how you can improve it with tooling, whether that’s how you interrogate data, or how that data flows through the end-to-end journey, from the clients’ ERP system to the processing on our side, and the submission to the tax authorities. It’s vital now – and it'll become even more critical in years to come.”

A broader skillset such as this can have a far-reaching impact, allowing the modern tax function to elevate its position in the organization. With data as the “currency” of a tax function, being comfortable with data sourcing and interpretation enables tax professionals to work more effectively with peer departments and to contribute more value to the C-suite by staying at the forefront of the rapidly-changing regulatory environment and informing broader business strategy.

In short: it’s a whole new ballgame. 

Brave new world

“The tax professional these days holds a huge amount of potential value for other parts of the organization beyond tax,” says Smith. “They can be far more targeted and data-centric with their advice. That requires confidence to interpret the data, to engage broadly beyond Tax and across the entire business landscape, open a dialogue and make suggestions, as opposed to simply discussing very specific questions on the tax return. Many people are comfortable with the latter; the former may push them out of their comfort zone.”

That kind of wider role for tax also requires people to place a greater emphasis on soft skills to promote their expertise across the business, including being able to articulate the opportunities at hand clearly, while responding to questions and challenges in return. They must be able to build trusted relationships and understand the nuances of working across cultures, embrace a global mindset and thrive on working with multicultural teams.

The right mindset and attitude are now key. Today’s professional must be agile, innovative and ready to handle uncertainty. They must also be proactive and team-centric when interacting with colleagues. More than ever, tax functions will need to engage with organization-wide technology and data programs to secure the strategic investment and functionality required.

“We’re all talking about how change is happening continuously and at speed,” says Stephanie Hamilton, EY Global Compliance and Reporting Talent Lead. “Being able to embrace that amount of change is an incredible skill to have. The transforming business environment is forcing people to be more transparent and authentic in how they collaborate and work with their teams.”

It’s no surprise, then, that a more widely developed skillset has become a key priority for tax professionals at every stage of their career. While young professionals starting out want to be clear on the skills required for the changing road ahead, experienced practitioners are equally concerned about ensuring they have the relevant skills to adapt. This may require upskilling or reskilling. “You need everyone to go on this journey,” says Smith, “as embracing technology is the only way to make its democratization successful and to release the benefits of investment.”

The race for talent

The backdrop of the broader race for talent has brought this topic into sharp relief for employers, too. As we live through the “Great Resignation,” with unprecedented numbers of people reconsidering their purpose at work and how they want to approach it, companies are scrambling to recruit the brightest talent, and it’s those candidates with the right skills who are holding all the cards.

“If somebody has tax experience with a strong technology thread running through their CV, and an appreciation of the power of data, they're the candidate everybody is clamoring for at the moment,” says Smith.

Even in today’s job market, many are looking strategically at what skills they need to bolster their CVs to stay relevant and be more in-demand going forward. Therefore, employers must ensure they have leading class, in-house training and skills development to nurture and retain the best talent.

The EY 2022 Work Reimagined Survey released in April showed that the largest number of employers (37%) saw improved learning and skills development as a key to helping employees thrive in a new work experience. It’s also something many employees are looking for: a quarter of workers would change jobs for better career advancement opportunities.

A diversity of experience and opportunities and premium learning programs are key offerings that will not only attract top candidates, but enable existing professionals to build the right skills. Balancing traditional tax technical learning with tech, data and transformation capabilities will provide the most rounded individuals in leading tax teams.

This is also evidenced by the 2022 EY Tax and Finance Operations Survey, which found that 95% of respondents believed their tax and finance personnel need to augment their tax technical skills with data, process and technology skills in the next two years. This aligns closely with the increased use of technology by tax authorities and financial regulators. In the US the Certified Public Accountant certification is going to include a technology component, whereas previously it was just accounting, auditing, tax and law. Likewise, universities are now offering Tax Digitalization and Tax Technology degrees, recognizing the growing relevance to aspiring tax professionals.

“The skills we’re looking for in our people are technology awareness and know-how, and technology qualifications are definitely something we’re seeing more of,” Smith adds. “So, it doesn’t surprise me that it’s now incorporated into the standard industry body offering.”

Smith offers the following practical steps to ensure the journey of recruitment and training is smooth:

  • Create a vision for your tax function in the next 5, 10 and 20 years. You need a feel for what roles the function is going to fulfill, what resources you're going to bring in, what technology you're going to build or procure, and how you're going to work with other parts of the organization. Only then can you judge the skills you have now against those you need and assess the gap in between.
  • Look at how you're drafting your role profiles for vacancies, who you're recruiting, and from where. Consider a more dynamic pool – such as the science, technology, engineering and mathematics disciplines, or other fields of business where you can attract individuals with diverse skillsets.
  • Ask yourself how you are helping to build and refresh the necessary skills among your existing teams. When hiring from universities or other sectors, how are you bridging the gap between what they’ve learned as theory and what they now need to know practically? Make sure your training covers everything from tax technical to technology and data and, increasingly, the soft skills that will be essential when dealing with the C-suite and other parts of the business.
  • Establish the role of outsourcing or co-sourcing. When facing challenges to recruit the people you need, consider easing the burden with resources and technology provided by trusted third parties. You can then focus on recruiting and developing the skills required for critical or sensitive in-house tasks, while outsourcing more general tasks.

“A lot of times we talk about this as the skills of the future, but it's really what we need our people to be developing now,” says Hamilton. “Every business is going to have different things to offer and deliver on it a little bit differently. But at the end of the day, we're out there competing for the same thing – trying to get the best talent that we possibly can into our organizations.”

Summary

As the landscape continues to shift, employers must think outside the box with an emphasis on opportunities and learning. While candidates are continuing to expand and differentiate their skillsets, an analytical mindset is no longer optional for today’s tax professional: It’s a must.

About this article

By EY Romania

Multidisciplinary professional services organization

Related topics Tax