Compliance in an Always-On Era:
Sudden, Relentless & Consequential Changes
Digital transformation has fundamentally changed how governments and tax authorities around the world implement and enforce tax and compliance obligations. With systems increasingly built for real-time and transparent exchanges of information, governments now demand greater and faster access to transactional data.
Why? Tax gaps, the amount owed less the amount collected, now total in the billions – $688B in the U.S., €61B in the EU alone. As a result, governments have embraced technology to decrease fraud, increase revenue capture and
assess taxable positions. Through capabilities such as continuous transaction controls (CTCs), tax authorities can now view a company’s activity data in real time. Over 80 countries have adopted e–invoicing mandates, a number
expected to grow rapidly.
There are also increasing levels of cooperation between governments. In the EU, VAT in the Digital Age (ViDA) proposes collective technology use as fundamental to VAT reforms aimed at adding tax revenue and spurring
economic growth.
Adding to the complexity is the sheer pace of change. In the U.S. alone, there are nearly 13,000 distinct tax
jurisdictions, generating more than 1,400 different forms and an annual average of more than 600 changes to tax laws. All told, we see more than 14,000 regulatory changes each month across 19,000 taxing jurisdictions.
