Evolving the tax function with AI: Four key insights to guide tax leaders

Partner, Tax Technology & Transformation, PwC Ireland (Republic of)

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AI is beginning to change both what the tax function can do and how it creates value. For Irish organisations, that matters now. Pillar Two, expanding Revenue expectations, and a mounting compliance burden are increasing the demands on tax teams. The greatest opportunity lies not in isolated pilots, but in embedding AI into tax controls, forecasting, and advisory work. This article sets out four shifts that should guide tax leaders as they shape a more effective operating model.

Four insights to guide tax leaders

Organisations continue to invest heavily in technology, yet the tax function has often been among the last to realise the benefits. That’s starting to change. As AI matures, the path from investment to value is shortening for tax teams prepared to pursue a deliberate strategy.

The broader pattern is now well established. Only a limited number of organisations are capturing transformational value from AI. Many more are realising narrower returns in the form of efficiency gains and additional capacity. In Ireland, businesses are moving from experimentation to action, although trust, governance, and the challenge of scaling value remain material constraints according to our 2026 AI Business Predictions. The organisations pulling ahead aren’t those pursuing the largest number of pilots, but those making focused bets and executing against them with discipline.

For tax leaders, that lesson is directly relevant. AI is no longer simply a productivity tool. It has the potential to place tax closer to the centre of the finance data ecosystem, strengthen its contribution to forecasting and decision-making, and support a new operating model in which people and technology work together more effectively.

AI can place tax at the heart of the finance data ecosystem. By embedding tax logic into the systems and workflows the business already relies upon, tax teams can address issues ranging from tax basis calculations and cross-border structures to currency effects and investor or Revenue enquiries, without relying on repeated requests across other functions.

The practical gains are already evident. AI can identify data discrepancies, duplicate transactions, and unusual period-on-period movements. It can generate tax projections by jurisdiction, surface material risks, and help organise supporting documentation in a more audit-ready form. Taken together, these capabilities represent a meaningful step change: tax operations that are better informed by data, more responsive to risk, and better equipped to withstand scrutiny.

For Irish organisations, the relevance is immediate. Pillar Two, expanded Revenue reporting expectations and a growing compliance burden all increase the need for more direct access to reliable tax data. AI can help tax teams meet that need, but only where leaders focus on the right workflows and redesign them with intent.

That is the critical point. As our 2026 AI Business Predictions makes clear, broad-based experimentation may generate activity, but it rarely produces meaningful outcomes. Real value comes when leadership identifies a small number of high-value use cases and applies the necessary talent, technical capability, and change discipline to execute against them. The question isn’t how AI can be inserted into an existing workflow, but what a better workflow would look like if designed around AI from the outset.

AI is making scenario modelling and simulation far more accessible, allowing tax to play a fuller role in business planning and decision-making. That marks an important shift. Historically, tax has often been asked to assess the implications of decisions after the fact. Increasingly, AI enables tax to contribute earlier and with greater precision.

With the right data foundation, tax teams can use AI to evaluate proposed and enacted changes. They can simulate the effects of changing interest rates, trade and tariff policy, and supply chain reconfiguration. They can also improve forecasts of effective tax rates and deferred tax balances.

This capability matters because business conditions remain volatile. Irish organisations are navigating a more complex mix of regulatory, economic, and geopolitical pressures, and leadership teams need a clearer view of the tax implications of strategic choices. AI can help tax provide that perspective in a timelier and more rigorous way.

There is also a clear opportunity for Irish organisations prepared to move decisively. Our AI Agent Survey found that 70% of Irish respondents plan to increase AI budgets by 2026. Yet only 9% report widespread use of AI agents, while 83% are still exploring or piloting. That gap between intent and scaled adoption is significant. For tax functions willing to act, it presents an opportunity to build capability before these tools become an expected part of the finance landscape.

AI is steadily raising the floor for tax by improving the quality, consistency, and speed of foundational work. It can gather and reconcile data, draft first-pass analysis, identify anomalies, and lay out options for review. What it produces is not a final answer, but a stronger point of departure.

That stronger foundation allows tax professionals to raise the ceiling. With more of the routine groundwork completed at scale, they can devote greater attention to judgement, interpretation, and commercial insight: challenging outputs, refining conclusions, and advising the business on the most appropriate course of action.

This reflects a broader pattern identified in our 2026 AI Business Predictions: the technology itself delivers only part of the value, while the greater share comes from redesigning work so that AI handles the repeatable tasks and people focus on what matters most. Our 2026 AI Jobs Barometer, based on analysis of more than one billion job advertisements globally, points to the same conclusion. AI-exposed entry-level roles are now seven times more likely to require traditionally senior-level skills such as judgement and leadership, and those roles have grown 35% since 2019, while other entry-level roles have declined by 10%. Roles shaped by AI are increasingly placing a premium on expertise, judgement, and leadership rather than reducing the importance of human capability.

The tax function will continue to depend on strong technical expertise, but future value will increasingly accrue to those who can combine that expertise with commercial understanding, confidence in working with data, and the ability to translate analysis into action.

These developments point towards a new tax operating model: one that formalises how people and AI work together and supports closer alignment with the wider business.

The long trend towards ever-greater specialisation may begin to moderate as AI takes on more repeatable tasks. Deep technical expertise will remain essential, but tax functions will also need professionals who can oversee broader workflows, manage AI-supported processes, and connect tax insight to business priorities. Over time, new roles are likely to emerge, whether formally designated or not: tax data leads, model governance leads, and individuals who can bridge tax requirements with technical delivery.

Governance must be central to that model. As our 2026 AI Business Predictions notes, Responsible AI is moving from principle to practice, but many organisations still find it difficult to turn those principles into operational processes. For tax, where accuracy, documentation, and regulatory scrutiny are fundamental, weak governance is not a secondary issue. Human review protocols, defined accountabilities, model testing, and auditability need to be embedded from the outset.

This is also a workforce issue. Our 2026 AI Jobs Barometer indicates that organisations with greater exposure to AI are growing headcount faster than those with less exposure. In Ireland, workforce readiness is also improving: companies most able to use AI are seeing faster headcount growth than the least AI-exposed companies (52% vs 36%), reinforcing that AI is more likely to reshape roles and raise skill requirements than simply reduce workforce demand. For tax leaders, the conclusion is important. Embedding AI into the operating model is not simply a route to efficiency; it’s a route to a stronger, better-skilled function.

Building the AI-enabled tax function: where to begin

The right response is not to pursue every possible use case. It is to identify a small number of areas where the value is tangible, the data is available and the case for change is strongest.

For many Irish tax teams, the most promising starting points will include controls over core data, high-volume reconciliation processes, audit-ready documentation and effective tax rate forecasting. These use cases can produce visible benefits relatively quickly while helping teams build confidence in governance, workflow redesign and human oversight.

Tax leaders should also recognise that this cannot be treated as a tax-only agenda. Progress depends on the quality of enterprise data, access to technical capability, a clear risk framework and support from finance and business leadership. Tax functions that attempt to move in isolation are less likely to scale successfully.

The window is now open. AI can lighten the operational burden, strengthen analysis and extend the reach of the tax function well beyond what was previously possible. Those who adopt it with intent, embedding it into controls, forecasting and advice while keeping skilled professionals firmly in command of the outcome, will be best placed to lead.

AI is moving tax from the end of the reporting process to the centre of the finance data ecosystem, giving teams faster access to the insights they need to manage risk and support better decisions. As automation strengthens controls and day-to-day operations, tax professionals will have more capacity to advise the business — but only if organisations build the right skills, roles, and governance around AI.

Johnny Wickham, Tax Technology and Transformation Leader

Next steps

Shift the culture

Leadership teams should lead by example, using AI in their own work and signalling clearly that it’s integral to the future of the function. Adoption is more likely to take hold where AI is embedded into the tools and processes teams already use, rather than positioned as a separate initiative. Roles, incentives, and performance measures should also be aligned to the desired future state, with governance expectations built in from the start.

Invest in people

Tax teams need the time, support, and psychological safety to experiment with new tools and ways of working. Capability-building should extend beyond technical AI literacy to include stronger commercial understanding, data interpretation, and communication skills. Just as importantly, leaders should provide clarity on how roles are likely to evolve, supported by structured change management to maintain engagement and confidence through the transition.

Assemble nimble teams with the right enablers

An AI-enabled tax model requires a focused mix of tax expertise, data capability, technology support, and governance oversight. Rather than relying solely on large-scale, lengthy delivery models, many organisations will make faster progress through smaller, more agile teams that can deliver specific outcomes, such as a bespoke reconciliation engine or a live dashboard tracking critical tax activity. The goal should be tangible progress, delivered with clear business alignment.

Build governance in early

Governance cannot be treated as an afterthought. Tax leaders should define risk appetite, establish protocols for human review and testing, and assign clear accountability for model oversight, data quality, and documentation standards. In a tax context, governance is not merely a control mechanism; it’s the foundation that allows AI to be deployed with confidence and sustained over time.

Evolving the tax function with AI: Four key insights to guide tax leaders

Four insights to guide tax leaders

Building the AI-enabled tax function: where to begin

Next steps

Shift the culture

Invest in people

Assemble nimble teams with the right enablers

Build governance in early

We’re here to help

Tax Technology and Transformation

Power your tax strategy with technology.

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Contact us

Evolving the tax function with AI: Four key insights to guide tax leaders

Four insights to guide tax leaders

Building the AI-enabled tax function: where to begin

Next steps

Shift the culture

Invest in people

Assemble nimble teams with the right enablers

Build governance in early

We’re here to help

Tax Technology and Transformation

Power your tax strategy with technology.

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Contact us