Digital transformation driving operational excellence
PwC Vertex Moscow deck ver3
1. www.pwc.nl
Technology and tax compliance
How technology is shaping
the Tax Administration of the Future
Eelco van der Enden, PwC
Michael Roytman, Vertex Inc.
Second Workshop of the OECD FTA
E-services and Digital Delivery Project group
Moscow, 18-19 November 2015
2. PwC and Vertex Inc.
Today’s Agenda
E-services and Digital Delivery Workshop 18-19 November 2015
Pull out of an important
statistic goes in this area
20pt Georgia (white)
2
Slide
Introduction 3
The future state ecosystem at taxpayers 4
Tax Administration Framework 5
Tax Administrations Technology Infrastructure 6
Conclusion 10
3. PwC and Vertex Inc.
Introduction
Technology is enabling tax administrations to:
streamline operations,
improve security,
enhance analytics capabilities, and
create a model where tax administrations get the
transparency they desire in exchange for giving
multinationals the certainty they need.
In many jurisdictions, new technology promises the
opportunity to quickly implement this model.
3
Technology is a big driver in how tax
administrations play in the changing
compliance landscape and in improving
relationships between tax
administrations and taxpayers
E-services and Digital Delivery Workshop 18-19 November 2015
4. PwC and Vertex Inc.
The future state ecosystem at taxpayers
4
Tax Finance Third parties
Key
deliverables
Business intelligence
and analytics
Tax data hub
Tax
applications
Tax
sensitization
Tax data
management
Tax data
mappings
Enterprise
systems
Document management
Process management
and workflow CalendarData collection
Tax operations management
Data • The majority of Tax functions will receive all information in a ‘tax-ready format’ from either their enterprise-wide financial
systems or a dedicated tax data hub.
• Dedicated tax data hubs will become mainstream and be developed internally, licensed from a third-party vendor, and/or
accessed through an accounting firm as part of a co-sourcing arrangement.
• Data security will be high on the agenda of Tax functions due to concerns over confidential information being inadvertently
released or shared publicly.
Process • Most global tax preparatory compliance and reporting activities, including data collection and reconciliations, will be performed
within the company’s shared service center or will be co-sourced with a third party.
• Tax functions will use real-time collaboration tools to automate their workflow, document management, calendaring, and
internal controls. Rely on professional data analysis tools to assist in the decision-making process
E-services and Digital Delivery Workshop 18-19 November 2015
5. PwC and Vertex Inc.
Tax Administration Framework
5
Technology is essential to modernise tax administration, but yet is a tool which
needs to be backed up with a strategy, objective setting, sound tax policy,
proper infrastructure and competent staff.
E-services and Digital Delivery Workshop 18-19 November 2015
6. PwC and Vertex Inc.
Tax Technology Infrastructure
6
In technology-savvy environment tax administrations are leveraging on real-time collaboration
and data analysis tools to fully automate compliance processes and assist in the decision-
making for risk assessment, projections and audit planning and overall administration support.
E-services and Digital Delivery Workshop 18-19 November 2015
7. PwC and Vertex Inc.
Tax Technology Infrastructure
Tax Reporting and Collection
7
• Compliance and regulatory reporting (including country-by-country reporting)
• Total Tax Contribution
• Electronic registration
• Digital invoicing / e-accounting
• Electronic filing of tax returns / use of prefilled returns
• e-payment of taxes, online applications
• Data capture from 3rd
parties
• Prescribed ERP systems
Deliver secure and seamless
flow of tax information and
payments
Tax is a by-product of all daily
business transactions
E-services and Digital Delivery Workshop 18-19 November 2015
8. PwC and Vertex Inc.
Tax Technology Infrastructure
Big Data and Analytics
8
• Unlimited storage of the original, unaltered information
• Analysis across multiple periods, taxpayers and tax domains
• Predictive analytics and simulations
• Risk profiling and scenarios-based calculations
Increases ability to understand
historical activity and
taxpayer behavior/ risk profile
E-services and Digital Delivery Workshop 18-19 November 2015
9. PwC and Vertex Inc.
Tax Technology Infrastructure
System Security and Confidentiality of Taxpayer’s Data
9
• Definition, management and enforcement of roles and permissions
• User authentication, authorization, provision
• Information encryption and network monitoring
• Incident reporting and response
Provides the foundation for
trust building by proper
stewardship of information
E-services and Digital Delivery Workshop 18-19 November 2015
10. PwC and Vertex Inc.
Conclusion
10
Technology is a big driver in changing
compliance landscape and relationships
between tax administrations and
taxpayers
E-services and Digital Delivery Workshop 18-19 November 2015
Technology drivers today are transforming the way
large corporations are able to leverage data to
manage their tax obligations. These same
technologies will allow Tax Administrations to keep
pace, assess risk and ensure that compliance is
realized.
A secure and interoperable infrastructure, robust
data management, and proactive analytics provide
the visibility required to achieve this mission.
Technology is the key
enabler for the Tax
Administration of the
future to communicate,
govern and manage tax
compliance.
