The Evolving Role of Corporate Tax Planning: A Strategic Asset Amid Automation and Generative AI

Melissa Hall, Senior Vice President of Global Tax at Assurant

Through this article Hall explores the evolving role of corporate tax planning as companies strive to streamline operations and maximize shareholder value, highlighting the usage of Generative AI in tax strategy as a key element for sound financial planning.

Corporations consistently seek to streamline operations and maximize shareholder value and, in this process, rely increasingly on tax strategy as a core component of financial planning. Within corporate tax departments, tax compliance and processing are positioned for automation or outsourcing while tax planning continues to contribute substantial value to the corporation.

With tax planning considered a competitive differentiator for corporations navigating complex global tax landscapes, generative AI can play a key role.

Tax practitioners can envision a future where AI transforms corporate tax planning, offering advanced support for strategy development, scenario planning and tax optimization. But even now, AI can perform more fundamental tasks like summarizing tax laws and rulings. This support means that AI can play a role today in streamlining the foundational work that forms the basis of effective tax planning.

“Tax professionals remain responsible for the advice they provide, but when integrating AI into tax strategy, they might also envision a world where AI can take that next step and help in developing creative tax strategies.”

Tax planning relies on a clear understanding of complex laws, regulations and rulings, which vary across jurisdictions. AI can assist by summarizing large volumes of tax-related information, creating concise, understandable summaries of tax codes, legal precedents and recent regulatory updates. This saves significant time for professionals and reduces the risk of missing something important.

For instance, when a new tax law passes, AI can summarize the legislation’s text, distill key provisions and highlight potential impacts on specific industries. This allows tax professionals to stay informed without spending hours reading through dense legal documents, ensuring they have the latest insights to guide their planning decisions.

Research is an essential component of tax planning, as tax teams must understand various laws, case histories and international regulations to build effective strategies. AI can conduct tax research based on specific guidance provided by seasoned tax professionals, quickly sifting through databases, legal archives and financial records to find relevant information. AI can also scan sources to answer questions, providing tax teams with information that would otherwise take hours to compile.

For example, if a tax team wants to understand the impact of a specific international regulation on its operations, AI can generate a list of relevant rulings and summarize key points, supporting faster, more informed decisions.

Using AI in tax planning, however, raises important ethical considerations. Tax professionals have a duty to ensure accuracy, compliance and integrity in their advice and while AI tools can enhance decision-making, relying on AI-generated insights must be done with due care. Professionals must verify AI-generated data, as errors or biases within AI can lead to incorrect conclusions.

The “black box” nature of AI systems further poses a transparency challenge, as it can be difficult to fully understand how conclusions are reached. This lack of transparency complicates accountability, as professionals are ultimately responsible for any advice they provide, regardless of the technology used. Maintaining professional ethics requires tax advisors to critically assess AI outputs and apply their professional judgment as to whether the conclusions are accurate, complete and in line with professional standards.

The role of corporate tax planning is evolving as companies increasingly view tax planning as a strategic asset amid rising automation. With compliance tasks moving toward automation or outsourcing, planning has become a key differentiator for corporations operating in complex global environments.

AI offers the possibility to accelerate tax planning today by expeditiously performing the extensive research that forms the groundwork for the planning.

Tax professionals remain responsible for the advice they provide, underscoring the need for critical assessment and professional judgment when integrating AI into tax strategy, but they might also envision a world where AI can take that next step and develop creative tax strategies.