Tax managers after budget approval

🥵 The budget of in-house tax teams has always been under pressure. The workload of tax is at an all-time high, and this will only get worse in the future. Therefore, one would expect more resources, right? Well, unfortunately, most of the time the contrary is true. Like all other corporate functions, tax is forced to do more with less. To work smarter, not harder. Sounds familiar to you?

Here is a wake-up call: tax is not like the other back-office functions. Tax cannot be seen as a routine function. The overall importance of tax in society is rising. The overall complexity of the tax system has never been higher. The stakeholders of tax are more demanding than ever. The tax risk exposure is only going up. And oh yeah, tax controversy continues to be on the rise. Every multinational needs a tax function that is truly strategic and acts as a solid business partner.

Based on this, one would expect that getting budget for the transformation of the tax function would be a no-brainer, right? Nope 🙅‍♂️. Tax leaders hear from their CFO that the ongoing cloud ERP migration gets priority. They are forced to wait and continue working with the limited resources they have. The tax budget, like for other functions, often is set as follows: (tax budget current year = tax budget last year - x%). Doesn’t make sense…

Here is the good news. The 19th-century poet and playwright Oscar Wilde can help us out. He said the following quote: “nowadays people know the price of everything and the value of nothing.” Are you with me? We need to get the attention of the CFO away from “price”, and focus on “value”. Yep, I am talking about the importance of a business case. The importance of a RoI calculation.

When building your tax transformation business case, the obvious spotlight is on efficiency gains, operational excellence, risk monitoring and cost savings. That is normal. But here are 2 more drivers to include. First of all, a strategic and upstream tax function will help to achieve topline growth. For sure, no doubt. Secondly, there is a huge cost these days linked to “doing nothing”, to postponing the transformation… Mind the momentum.

Now, time to go and build your business case! Good luck! Before you know you are celebrating your budget approval! 💃

Video by @Olympics