The Future of GenAI in Corporate Tax Departments: Are We Ready for the Revolution?

Corporate tax professionals are gearing up for a potential revolution in their industry as they believe that generative artificial intelligence (GenAI) can and should be used for tax work. However, a recent report from the Thomson Reuters Institute found that many tax departments may not be fully prepared for the integration of this technology due to a lack of proper education.

The report, titled the “2024 Generative AI in Professional Services report,” revealed that while corporate tax professionals see the potential benefits of using GenAI in their daily work, adoption rates remain low. Only 5% of corporate tax professionals said their organizations were currently integrating GenAI into their work, with an additional 13% working on plans to do so.

Despite the low adoption rates, there is a growing belief among corporate tax professionals that GenAI will play a significant role in the future of their industry. More than three-quarters of those surveyed believe that GenAI can be applied to tax work, and a majority also believe that it should actively be applied.

However, there are several barriers that could potentially limit GenAI’s immediate reach in corporate tax departments. Concerns about data security, inaccurate responses, privacy, and confidentiality were noted as top barriers to adoption. Additionally, more than half of corporate tax respondents expressed concerns about users becoming too dependent on the technology, leading to a reduction in critical thinking and creativity.

One of the key challenges highlighted in the report is the lack of education and training around GenAI within corporate tax departments. Only 10% of corporate tax respondents said their organizations offered training on GenAI, the lowest of any professional service surveyed in the report.

In order for GenAI to truly make an impact in the corporate tax world, tax department leaders will need to focus on educating their teams and implementing proper change management programs. Training and ongoing education will be crucial for ensuring that GenAI is used properly with privacy, security, and accuracy in mind.

As one Canadian corporate tax manager noted, “It’s great to be able to experience the technological advancements of AI. While there are certain social and ethical issues and concerns that need to be addressed, I’m hopeful that all of the issues and concerns can be worked out to allow for the future of great technology.”