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Generative AI: What should tax directors be thinking about?

In recent years, Generative AI has gained significant attention in the tax profession. With the emergence of large language models and user-friendly chat interfaces, tax professionals now have access to powerful AI-enabled solutions that can revolutionise their processes and decision-making.

In this publication, we aim to provide tax directors with a strategic framework for integrating Generative AI (GenAI) within the tax function. Rather than focusing on specific products and use cases, we will explore the broader capabilities of GenAI and its potential applications in the short, medium and long term. We will also address the risks associated with AI and the importance of developing a longer-term strategy to harness its full potential.

The re-imagining and improvement of processes through deployment of AI is becoming a core part of the role of a Tax Director.

Getting started


Tax directors should begin by understanding the potential of GenAI and its application within the tax function. This involves identifying activities where AI can play a part and atomising processes to their most granular level. It is important to assess the volume of work, human effort required and the potential for higher quality outcomes.

Additionally, tax directors should consider the feasibility of using tax-specific AI solutions or off-the-shelf options, as well as the availability and cost of quality data.

Risk associated with AI


Deploying AI in the tax function comes with inherent risks that need to be carefully considered. These risks include the need for a robust data strategy and governance framework, potential bias in data and AI models, ethical considerations, the risk of generating incorrect outputs and the evaluation of return on investment and potential obsolescence of bespoke solutions.

Developing a longer-term strategy


As the technology becomes more pervasive, traditional boundaries between organisational activities will blur and new ones will form. AI will change the way in-house teams provide services to the business and with the use of internal and external data, AI will drive operations and decision-making in new ways.

This will lead to the integration of tax functions across other organisational domains such as Compliance, Risk, Governance and Supply Chain. The emphasis on Governance will increase due to the need for significant focus on Data and Information Governance to manage the risks associated with AI, including in relation to tax.

At Deloitte, with our Deloitte Institute of AI, we have a huge focus in helping our clients seize the opportunities created by GenAI in tax, whether in specific use cases or broader strategic areas, always underpinned by our trustworthy AI principles. Our goal is collaborating with our clients, whether on our own or other technologies, to ensure value led - and values led - adoption.

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