What's Happening?
The 2026 Corporate Tax Department Technology Report by Thomson Reuters reveals a widening gap between tax functions that are advancing strategically and those that are lagging. The report highlights that 64% of tax departments are still operating in chaotic
or reactive modes, referred to as the 'frustration gap.' The report also notes a significant shift in AI adoption, with many departments expecting AI to become central to their workflow within one to two years. Despite these advancements, many departments face challenges in securing budgets and resources for technology investments.
Why It's Important?
The findings underscore the critical role of technology and AI in transforming corporate tax functions. Departments that successfully integrate these technologies can shift towards more strategic, proactive work, such as forecasting and risk assessment. However, the inability to secure necessary budgets and resources could hinder progress, leaving some departments at a disadvantage. The report suggests that departments need to prioritize low-cost, high-leverage moves to strengthen their business case for future investments.
What's Next?
Corporate tax leaders are encouraged to develop automation game plans and invest in tech training to enhance their departments' capabilities. Building a strong business case for technology investments will be crucial in securing future budgets. As AI becomes more central to tax workflows, departments will need to adapt their strategies to leverage these technologies effectively. The report emphasizes the importance of moving up the technology maturity curve to remain competitive.
