Jump Back
There’s a saying I came across recently that perfectly captures the current state of the tax market: “There are decades where nothing happens, and then there are weeks where decades happen.”
This observation is particularly relevant to the tax profession today. The tax world is undergoing one of the most profound transformations in its history – global, complex, and unlike anything we have seen before.
Remarkably, much of global tax policy remained fundamentally unchanged for over a century, dating back to the 1920s. Discussions and debates have simmered for the last few decades, but the real acceleration has only occurred in the past few years. This acceleration has aligned with significant technological advancements, notably in artificial intelligence, requiring tax professionals to adapt rapidly rather than incrementally.
The OECD, Pillar Two, and the End of Static Tax Policy
A central driver of change has been the OECD’s global tax reform, especially its Pillar Two initiative. While Pillar One addresses where companies should be taxed in a digital economy, Pillar Two sets a global minimum corporate tax rate of 15%. On paper, it sounds straightforward. In practice, it can be intricately complex. Achieving global coordination presents significant challenges. Countries have different tax structures, political landscapes, and economic priorities. Some, like Ireland, have agreed to align with the OECD’s recommendations. Others, such as the U.S. under Trump, opted out, adding layers of uncertainty. Despite varied national responses, one thing is clear: the era of static, nationally isolated tax policy has ended.
BEPS, Transfer Pricing, and Transparency: Complexity Is the New Norm
Tax reform is not limited to Pillar Two. There are ongoing changes in BEPS (Base Erosion and Profit Shifting), especially around transfer pricing. This has increased demand for specialists who understand cross-border risks and who can advise on tax structuring across jurisdictions.
Tax transparency has also become a critical issue. Organisations must now actively demonstrate and communicate their tax transparency. This trend has deepened the relationship between tax and financial reporting, and tax professionals now need to be fluent in both.
ERP systems are another game-changer. Tax used to operate in isolation, often relying on Excel. Now, tax data is baked into enterprise systems, driving real-time reporting. That means tax professionals must understand how financial data flows through the business and how to ensure its accuracy.
Enter AI: Reshaping Compliance and Reporting
Alongside regulatory upheaval, we are witnessing a revolution in how tax work is done. Generative AI and automation are beginning to streamline traditionally manual processes like reporting and compliance. It is important to recognise that these technologies serve as enhancements to human expertise, rather than replacements, at least for now. In the short to medium term, there is still a need professionals who can interpret data, ensure transparency, and make informed judgments.
This is prompting more firms to build tax technology teams and train staff in digital tools. However, structured qualifications in tax tech are still rare. There is an education and training gap in this area that the professional bodies will need to address soon.
The Tech Sector: Under the Microscope
Digitalisation hasn’t just changed how we do tax, it’s changed who gets taxed. Digital businesses, from tech giants to AI startups, are under intense scrutiny. Digital tax rules have emerged to address this, and they’re evolving fast. This has prompted a surge in demand for tax professionals in the tech sector, especially in advisory roles. Today’s tax challenges extend well beyond traditional income tax. Professionals must grasp data flow, value creation, and business structuring within a digital ecosystem.
Beyond traditional tech firms, data centres have also become a significant focus for tax authorities. In Ireland, for example, data centres are a particularly contentious issue due to their high energy consumption and the ongoing debate about their impact on national energy supplies. While some argue that these centres contribute to energy grid stability, concerns persist over rising energy costs for consumers. This ongoing debate has placed data centres firmly under the watchful eye of tax authorities, leading to increased audits and scrutiny of their tax structures.
The Talent Shift: From Local Knowledge to Global Insight
The introduction of Pillar Two has dramatically changed the talent landscape in tax, initiating a surge in demand for professionals who can navigate global compliance regimes. Local expertise is no longer enough. Modern tax teams require professionals capable of interpreting international frameworks, forecasting financial implications, and engaging in complex scenario planning.
Interestingly, this shift has sparked broader strategic discussions around the future ownership and governance of these responsibilities. Will financial modelling and tax forecasting become part of the CFO’s remit? Possibly. But right now, tax professionals are being asked to level up and blend technical expertise with financial acumen.
The Changing Shape of Tax Teams
In-house tax functions are shifting focus. More compliance and analysis work remains internal, while advisory work is increasingly outsourced to consulting firms. But as technology advances, these lines may blur again. One emerging theme is the need for tax professionals to perform beyond supplying technical knowledge and be key partners to the business. Tax professionals must be able to work with supply chain, finance, and operations teams – explaining what they need and why it matters. This is especially true in areas like transfer pricing, where the tax implications of operational decisions are significant. As tax becomes more visible to boards and CEOs, communication and influence are no longer optional, they’re critical.
The Strategic Rise of Tax in the C-Suite
Given all this complexity, it begs the question:
Historically, tax leaders have moved into CFO or CEO roles, but it has been more by chance than design. Today, the argument for a dedicated tax leader at the executive level is getting stronger.
Tax isn’t just a compliance function anymore, it’s strategic. Tax affects risk, reputation, profitability, and long-term planning. It makes sense to have someone at the top table who understands this from both technical and commercial perspectives. We have already seen this shift happen in transfer pricing, which evolved from a niche specialism to a core part of tax teams. A similar evolution could be on the horizon for broader corporate tax governance.
The Future of the Tax Professional
The future tax professional will look very different from the one of a decade ago. Technical expertise remains crucial, but that alone won’t cut it. Comprehensive tax functions need storytellers, analysts, tech-literate communicators who can partner across the business and influence strategy. Automation will change how tax teams work, but it won’t replace the human element. The real opportunity lies in using technology to elevate the role of tax, focusing on insight, strategy, and value creation.
The tax world is in flux. For tax professionals who thrive on complexity, change, and challenge, it is an incredibly exciting time to be in the profession.
Connect with our Tax Team
Kate Flanagan CTA | Partner | Tax & Practice | kate.flanagan@barden.ie | LinkedIn
Aoibhín Byrne | Associate Director | Tax, Treasury, Audit and Corporate Finance | aoibhin.byrne@barden.ie | LinkedIn.
Aideen Murphy ACA, CTA | Partner | Tax, Treasury & Practice | aideen.murphy@barden.ie | LinkedIn