AI can play a lead role in this transformation, ranging from automating repetitive tasks to providing analysis and insights. It can free up limited tax resources for complex and value-added work or enable and accelerate strategic planning.
AI-enabled automation is the key to inverting the workflow pyramid, says Albert Lee, EY Global Tax Technology and Transformation Leader. “For far too long people have considered tax an art. In reality, however, it is predominantly codified, and many processes can be standardized and automated using AI,” says Lee.
Lee maintains that it is now possible for non-Tax specialists (like finance and controlling teams) to initiate AI-automated tax processes, validate outputs and address any exceptions. Meanwhile, specialist tax practitioners have greater freedom to engage in value-added work such as tax law interpretation.
Early proof-of-concept use cases for AI automation include processes that are low risk, are highly manual and repetitive, have a high degree of human error and can adversely impact employee morale. For example, AI solutions can now automatically analyze a 10,000-line transactional account to identify tax-deductible activity, rather than committing human resource to this task. A degree of automation already exists in many other areas of tax, but with advances in machine learning, large language models and natural language processing (NLP), there is now an opportunity to conduct this work faster and more accurately while extracting powerful actionable insights from the tax data.
Denise Parker, EY Corporate Tax Partner at Ernst & Young has been involved in this drive to adopt AI, pushing the boundaries of what’s achievable using the technology within the tax function. She has been at the forefront of introducing Microsoft’s Copilot solution across the EY organization's Oceania Tax operations.
“Automation and AI are transforming how compliance tasks are performed, enabling our teams to handle complex data with unprecedented speed and precision,” says Parker. “The automated mapping of general ledger accounts ensures that tax-sensitive transactions are accurately identified and categorized, reducing the risk of errors and enhancing compliance with regulatory requirements. Meanwhile, transactional level analysis, powered by AI, provides deep insights into financial data, uncovering patterns and anomalies that might otherwise go unnoticed.”
Parker says AI automation has achieved the desired effect, enabling teams to switch focus from routine compliance to high-complexity value-added areas.
2. Enhancing training and accelerating career trajectory
Technologies such as GenAI are also having a powerful impact on tax team training and development both directly and indirectly. Organizations are harnessing AI tools directly to create personalized training programs for new hires, helping them acquire skills needed to bridge the talent gap, and maintain training and development levels as they progress.
According to Kushan Shah, EY Global People Advisory Services Tax Technology Leader, AI is also helping to redefine the very nature of tax teams and the work they do. “GenAI can help new starters more quickly overcome the learning curve of the profession by augmenting much of the traditional task load, and allowing broader application of an analytical skillset,” Shah says.
Shah reiterates the point that much of the “number crunching” associated with junior roles may soon be transformed, thanks to AI automation. Junior tax practitioners’ skillset growth will likely be accelerated as AI becomes part of daily workflow, enabling them to adopt a more analytical and consultative stance earlier in their career.
Junior tax team members will also likely feel more fulfilled as they witness firsthand the positive impact their input has on stakeholders thanks to their engagement in higher levels of analytical work and their ability to see the bigger picture.
