Tax leaders

Latest findings from PwC’s Pulse Survey

Tax policy takes a backseat to economic uncertainty

US and global tax policies aren’t the dominant stories they were a few months ago. The Inflation Reduction Act of 2022 (IRA) resolved many questions around the direction of US tax policy, and the US Department of the Treasury’s guidance surrounding the act’s tax increase provisions and numerous credits and incentives is pending. At the same time, many wonder if and how the Organisation for Economic Co-operation and Development’s (OECD) Pillar One and Two proposals will proceed in key jurisdictions around the globe. 

Tax leaders are modeling for all of this while navigating the near-term demands of changing macroeconomic conditions. Sixty-five percent of tax leaders are very concerned about the impact that a potential recession and stock market volatility could have on their businesses according to the latest PwC Pulse Survey. Reducing headcount isn’t easy when the tax function actually needs more people. Tax leaders are crafting new playbooks with strategies that differ from those used in the past: preserving talent, digitization and outsourcing. 

Talent and technology

Cash is king, but talent is queen as tax leaders try to preserve headcount.


of tax directors say their function is mostly or completely prepared for the risk of a global recession

Job cuts are a last resort amid economic uncertainty

As recessionary pressures mount, tax leaders are prioritizing cost reduction and cash preservation. Forty-eight percent of tax directors say their functions are prepared to quickly adapt for a global recession — though only 11% say they are completely prepared. In past downturns, talent would be the first target for reduction, but this economic environment is different. Unemployment is low, and only 8% of tax directors strongly agree that their companies successfully attract and retain the talent they need.

Thirty-three percent of CHROs say they’re completely confident in their organization’s ability to prevent “quiet quitting.” Tax directors are less optimistic. Just 9% are completely confident. Given that it’s so hard to find employees with tax experience, one goal is to focus on keeping the people you have. That means greater flexibility in where tax professionals work — only 17% of tax directors require their teams on-site full time (versus 32% overall). Focusing on your current employees also allows lower performing employees the opportunity to improve. Only 19% of tax directors are completely confident in their company’s ability to exit low performers, compared to 37% of executives overall.

As they look forward to the next 12 to 18 months, 58% of tax directors are planning cost cutting other than headcount reductions. They’re also making targeted investments in digitization and automation intended to drive down future costs. Tax can also be a value driver when tied into the overall business strategy, helping companies generate incremental cash through tax planning.

What you can do 

  • Look beyond CPAs to take a tax efficient approach to business transformation, which could save future costs and mitigate risks. 
  • Consider whether you can eliminate some steps to free staff for innovation and activities that will add greater value.

Driving efficiencies

Outsourcing provides greater options for tax functions to drive value.


of tax directors are coordinating digital investments to facilitate business transformation to a great extent or somewhat

Tax considers outsourcing to augment available talent 

Headcount may not increase, but reporting requirements will, and tax is relying more on automation, co-sourcing, outsourcing and managed services to supplement key talent and growth strategies. Digital tools that help simplify reporting, support continual analysis and drive greater insights are essential to helping companies keep pace with growing tax reporting complexities and curb costs. Seventy-one percent of tax directors are coordinating digital investments to facilitate business transformation to a great extent or somewhat, working closely with the CIO.

Previous Pulse Survey results showed that tax directors have been focusing on digital transformation, managed services and co-sourcing. In January, 53% said they planned to accelerate digital transformation to keep up with the evolving global tax landscape. In August, 55% were increasing investments in digital transformation to support business strategies.

Most tax departments are calculating how to create efficiencies that can help reduce costs. Is it more cost effective to transform the department with the people you have, co-source or move toward a managed service model? While managed services and co-sourcing can free up talent to focus on higher value tasks, automating and digitizing more routine tax activities can often deliver more quickly..

What you can do 

  • Strengthen ties with CIO to get ahead of planned technology updates where tax could be a differentiator (e.g., ERP cloud upgrades). 
  • Review your tax ecosystem — including people, data, technology and processes — to eliminate redundancies.

Scenario modeling

Tax leaders evaluate multiple scenarios to identify opportunities and risks as they await US tax regulations and enactment of global tax policy changes.


of tax leaders say their functions are mostly or completely prepared to quickly adapt to evolving US and global tax policies

Emphasis is on planning for US, global tax policy outcomes

With the IRA in place, the potential for further major changes in US tax policy is limited, though there is the possibility of bipartisan year-end action to restore business-favorable provisions like the business research expenditure deduction. 

The Treasury Department is working on implementation guidance for the IRA, including the climate and clean energy tax incentives as well as book-income minimum tax. On the global stage, the OECD’s Pillar One and Pillar Two proposals are in limbo. Whatever happens, 85% of tax leaders say their functions are mostly or completely prepared to adapt to evolving US and global tax policies.

Sixty-two percent of tax leaders are communicating with management and the board about the impact of US and global tax policies to help inform business strategy. As companies consider future investments, they may shift capital around. This could result in moves that could influence supply chains. Tax leaders have an opportunity to collaborate with the COO; 55% of tax directors are already doing so to at least some extent.

Pillars One and Two present a challenge. Many are skeptical the measures will move forward as envisioned given the lack of agreement among countries on fundamental issues. Companies are building models and undertaking scenario planning in the interim.

What you can do

  • Model the impact of various incentives to inform capital investment decisions.
  • Assess the likely financial and operational consequences of Pillar Two.

About the survey

Our latest PwC Pulse Survey, fielded October 12 to October 18, 2022, surveyed 657 executives and board members from public and private companies about the current business environment, the risks executives are facing and the impact those risks have on company strategy and growth plans. Of the respondents pool, 89 are tax leaders.

Contact us

Ken Kuykendall

Ken Kuykendall

US Tax Leader and Tax Consulting Leader, PwC US

Kevin Levingston

Kevin Levingston

Tax Policy Services Leader, PwC US

Shari Forman

Shari Forman

Tax Compliance Services & Private Tax Leader, PwC US

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