A new study by tax technology company Vertex has exposed critical skills gaps in tax teams that could hinder businesses’ progress in digital tax transformation.
The Global Tax Transformation survey which gathered insights from 610 tax and finance professionals across Europe and the US showed that nearly half (44 percent) of tax and finance professionals feel unprepared to meet the demands of digital transformation, with 43 percent citing insufficient technology or data expertise.
The rapid pace of transformation is straining teams, with 49 percent of respondents concerned about heavier workloads caused by staff turnover. Mental health is another pressing issue, as 44 percent of professionals express fears of stress and burnout during the transition.
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Responding to the findings, Peter Boerhof, senior director of VAT at Vertex, said that digital transformation presents a wealth of opportunities for tax teams: “However it’s evident from our research that robust support for employees is critical during the transition.
“Business leaders should consider working more closely with finance and tax employees to make employees’ health and wellbeing a priority and provide the skills and resources they need to succeed.”
Employee retention is also at risk, as 35 percent of European respondents are considering switching to roles in other companies with less organizational change, while 25 percent are contemplating leaving the tax field altogether.
Budget constraints and resource shortages are further complicating transformation projects. In Europe, 37 percent of respondents report that reduced budgets are impeding their ability to meet expectations.
Talent shortages are also stalling automation efforts, with 28 percent identifying a lack of skilled staff as a key barrier. Additionally, insufficient IT support (34 percent) and limited recognition of the importance of leadership and people skills (26 percent) are undermining project success.
Opportunities amid challenges
Despite the obstacles, many professionals view transformation as a career opportunity. More than half (53 percent) of European respondents see digital transformation as a chance to advance their careers, with this sentiment rising to nearly 60 percent in the UK. Even more, 48 percent of European tax and finance professionals are shifting their focus toward technology-driven roles, signaling a growing embrace of change within the sector.
Vertex’s findings emphasize the need for businesses to address skills shortages and provide stronger support to ensure successful digital tax transformation while fostering employee wellbeing and retention.
Boerhof also highlighted that with the increasing prevalence of real-time and near real-time digital tax reporting mandates coming into force across the world, having the right technology in place will be critical to futureproofing the tax function:
“But successful transformation will rely on more than just technology. Tax teams will need to work closely with other departments in the wider organization, such as IT and finance teams, to ensure transformation is not only implemented successfully but teams also feel supported.
“There is a huge opportunity for tax professionals that embrace change to advance their careers as well as supporting business growth.”
What it means for ERP insiders
As businesses embrace digital tax transformation, a study by Vertex reveals that talent shortages and skill gaps pose significant challenges for tax and finance teams. With nearly half of professionals feeling unprepared for the demands of digitalization, organizations must prioritize employee support and development to ensure success. Key findings from the study include:
- Skill Gaps: 43 percent of professionals cite insufficient technology or data expertise as a major hurdle to digital transformation.
- Workload and Well-being: 49 percent are concerned about increased workloads from staff turnover, with 44 percent fearing stress and burnout.
- Budget and Resource Challenges: Reduced budgets (37 percent) and talent shortages (28 percent) are slowing automation and transformation efforts.
- Collaboration and Leadership: Limited IT support (34 percent) and insufficient leadership focus on people skills (26 percent) are further impeding progress.
- Opportunities amid Challenges: Despite obstacles, 53 percent of European professionals see transformation as a career opportunity, with many shifting toward technology-driven roles.
Vertex emphasizes that successful digital tax transformation requires more than advanced technology. Businesses must strengthen cross-department collaboration, address skill shortages and prioritize employee well-being to futureproof tax functions and unlock opportunities for growth and innovation.
