This article was co-written by Santiago Fernandez, Senior Manager, KPMG Luxembourg.
There’s no denying that generative AI tools have taken the world by storm. But for no small number of people and organizations, these tools might be rocking the boat a bit too much for their liking. Their reactions to tools such as ChatGPT are still somewhat ambivalent, with many leaning towards diminishing, denying, or even banning these tools.
Meanwhile, in the realm of tax professionals, the opportunities prove vast, rendering it crucial to evaluate how generative AI technologies can, and will, enhance what tax professionals and organizations can offer in the medium to long term.
The use and application of generative AI by those in the tax profession will likely be permanent, substantial and transformational, echoing Bill Gates's sentiment that “the development of AI is as fundamental as the creation of the microprocessor, the personal computer, the Internet, and the mobile phone.”
Tax professionals must embrace and understand the benefits of incorporating generative AI tools into their work to broaden their knowledge and drive significant change. Tools like ChatGPT and Midjourney should be viewed as valuable extensions of human capabilities – like a helpful colleague or a co-pilot – rather than as threats to job security.
Of course, it’s not all sunshine and rainbows yet when it comes to generative AI. As with all new technologies, it is also critical to address ethical concerns, regulatory frameworks, and privacy considerations. The creation of safe usage guidelines is expected to become the norm in many organizations as a means of ensuring proper and effective use of generative AI applications.
A holistic approach – how generative AI can help all tax functions
Tax compliance
Generative AI tools (which work alongside traditional tax compliance tools), including machine learning, are already streamlining, and making many of the very time-consuming aspects of any tax compliance process obsolete. AI enables tax professionals to focus on value added tasks, as well as identify and analyze risks and opportunities for improvements that they can share and discuss with their clients.
Tax controversy
Generative AI can help tax professionals to identify, react to, and report on potential areas of controversy risks well in advance. It is an ally that will be able to comprehend increasingly complex and voluminous case law and predict outcomes in any given fact pattern.
Tax advisory
Generative AI technologies can provide instant access to aggregated knowledge and insights, enabling tax functions to focus more on value creation and strategic activities.
Transactional activities
Generative AI can be a valuable collaborator when it comes to:
- carrying out transactional work
- helping tax professionals to access better information
- uncovering abnormal or inconsistent tax qualifications
- making better informed decisions
- communicating complex tax concepts and strategies more effectively to stakeholders with different backgrounds and levels of understanding
Knowledge management
Generative AI can not only assist with the comprehension of this knowledge, but also with drawing insights or conclusions more effectively from it. And in a world where changes in rules, regulations and business models evolve at lightning speed, tax professionals may finally feel like they can keep up.
Business integration
Generative AI tools can help advance business integration by:
- providing data analysis and insights closer to real-time
- generating simplified analyses and narratives for complex tax concepts and regulations
- keeping up with increasing volumes of transactional data
- producing tax impact analysis and personalized executive summaries
Threat or opportunity?
Generative AI tools are far from being a threat to tax professionals: they represent the very best opportunity to enhance and empower the tax professional of the future.
Want to know more about how to optimize generative AI tools in the tax profession? Get in touch with KPMG Luxembourg’s team of experts today!
This blog post is based on a publication from KPMG International. You may download the full report here The use of generative AI tools in the Tax profession - KPMG Global (PDF, 3.5MB
