PwC/GE tax deal - a game changer for the way businesses use consultants
13 January 2017
Should we manage our tax affairs in-house or use consultants? For big businesses, it’s usually a bit of both, with large in-house teams supplemented by advisers who can give an external perspective and specialist expertise.
But the deal we signed this week with General Electric marks a radical shift in how things can be done.
The five-year agreement will see PwC delivering significant tax services to GE’s operations worldwide, having taken on over 600 of their tax professionals around the globe.
It’s a first of its type and genuinely ground breaking - I think it paves the way for things to come, but why?
Followers of our Tax Function of the Future will know we have long forecast that tax functions are set to change. A host of forces are coming together to cause organisations to redefine how they manage their tax affairs and where resources should be focused.
Never before has tax been more important to governments, taxpayers and other stakeholders. It’s also never been more complex, volatile or highly regulated. As the demand for tax policy and tax controversy tax personnel continues to increase, the demand for data and tax professionals proficient in data analytics, statistics and technology is unprecedented.
Moreover enhanced scrutiny and execution risk is forcing companies to continuously evaluate their tax decisions. Tax professionals not only need to be highly attuned to these risks, but require sharp communications skills to explain what they’re doing and why.
How much of this risk do businesses want to manage themselves? How much are they prepared to expand tax departments to take on the skills, processes and technologies to cope? Ultimately what’s core to the business and what’s not.
At the same time businesses don’t want to lose control of such an important and increasingly sensitive area.
The GE deal isn’t just about onboarding people - we’re integrating GE’s tax technologies and processes so they get a seamless service. Crucially though, they also get additional external perspective.
We think other organisations will follow suit, and who knows, this type of arrangement could expand beyond the tax arena.
We’ve long talked about the Tax Function of the Future - that time has arrived.
For more information, please contact:
Global Head of Tax Reporting & Strategy