Michael Cox on navigating the digital landscape

& Herbert Smith Freehills' Chief Operating Officer, Michael Cox, presented
at The Tax Institute’s 2017 SME Symposium on ‘Navigating the digital landscape
– a plan for today’s tax professional'.

Here he speaks about the steps tax practitioners can take to address digital
disruption in their profession, the technologies needed to operate an evolving
tax practice, and why technology is so important in today’s business world.

What steps
can tax professionals take to navigate the new landscape?

“Undoubtedly, there's lots of technology out there. There
are three steps that I'd call out in the tax space and number one is the Australian
Tax Office. They're going through huge transformation. In the next 12, 18
months, I think we'll see every form of communication and interaction through a
digital means. The second one is automation. I can see us starting to replace
some of those activities that we've offshored, some of those low value-adding
activities, and replacing them with automation technology. When we do that,
we'll see the time that we spend on those things significantly reduced.”

“The third that I see happening is we'll start to see the
vendors incorporate machine learning into their tax platforms because at the
end of the day, machine learning is about categorizing transactions, which is what
tax people do. When those three pieces of technologies start to come together,
then I think we start to see a real end-to-end disruption of the tax world.”

technologies will be needed to operate the evolving tax practice and grow
client bases?

“I think it's safe to say that most tax professionals feel
comfortable about tax topics, but don't about technology, so increasing their
knowledge is probably the first step”.

“The second one is they need to change their mindset from
being binary to being open to options. I hear very often tax professionals
saying, “Because we don't have the full end-to-end perfect machine, we're
really not interested,” when in fact, there's lots of really good technology
that people can be looking at to pick up in a tax process. The third thing is
you need to know where to spend your money. The best way to do this, is to have
some form of framework to help you divide how you'll spend your money and make
your investments. When you do those three things together and have a go, that's
how you start to navigate the future.”

Why is
technology so important in today’s business world?

“As shown in a recent study, digitally enabled businesses,
particularly in the small and medium sized space, are likely to have at least
50% more revenue per employee than those that are not, so it's something worth
tackling. If I were to pick one single piece of technology to start with, that
would be technology in the area of collaboration and communication. Today, all
of us feel very at home and familiar with using Facebook Messenger, WhatsApp,
etc., but when it comes to talking to our clients, we are in black and white
letters, so I think any piece of technology that can change the way that we
interact with our client can only be for the positive.”

With the tax
landscape continually changing, professionals need to evolve to stay relevant.
That’s why The Tax Institute has evolved its membership, education and
information programs to meet practitioners’ needs both now and into the future.
here  for
more information on what education you’ll need to up-skill in today’s
fast-changing tax environment.


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