Deloitte Tax chair and CEO Carin Giuliante recently became the first female to lead the Big Four firm's tax practice and she is watching closely as new rules are taking effect in both the U.S. and internationally, while the firm tries to retain and recruit enough staff to handle the workload.
"There's so much that's intersecting at the moment," she said. "At the core of any strategy has to be your people, so we spend a lot of time thinking about our people, and not just how to attract them."
She also has been thinking of ways to retain talent. That includes allowing employees to work remotely, as many have grown accustomed to doing since the pandemic. The technology has evolved to allow more firms like Deloitte to function in a remote or hybrid work environment.
"The ever-changing technology not only impacts the work we need to do, but how we do it," said Giuliante. "What's the impact on our talent and retention, and what are the possibilities of what we can do with technology as we move forward?"
Motivating young employees is also important to keep them in the tax profession. "The world is very different than when I started 30 years ago, so motivating the folks we have while they're in the office is incredibly important too," said Giuliante. "We're really working on the balance of all those things to figure out how we build that next generation of qualified tax professionals, and hopefully someday tax partners and managing directors."
The Inflation Reduction Act provides a number of new tax incentives for renewable energy sources like wind and solar power. That could help motivate young people who are interested in working on ways to combat climate change.
"Any new legislation, whether it's in the U.S. or global legislation, there's always the opportunity to really spend time advising our clients and hopefully adding value to them," said Giuliante. "Certainly renewable energy credits, sustainability, and all things climate related are incredibly important to our clients, so we do have folks who are focused on that aspect of it. The younger folks love to work on those types of projects because it's a perfect example of how they can link their desire to have a purpose and to impact the world with what they're doing from a tax perspective. We've spent time really trying to educate the younger folks about why tax is so important, and some of the things that these investments and credits can drive."
Clients are also interested in international tax changes, such as the Organization for Economic Cooperation and Development's base erosion and profit shifting action plan with Pillar One and Pillar Two rules for combating tax avoidance and setting a global minimum tax rate of at least 15% for multinational companies.
"I'm sort of CEO by night and client service partner by day," said Giuliante. "Maybe it's vice versa — I can't decide — but I still do serve clients, and I have my entire career. I would say Pillar Two in particular is gaining an incredible amount of momentum, especially over the past few months. U.S.-based companies are starting to figure out that it's actually real, and it's going to come upon them. We went through a period over the past 18 months or so of wait and see. Clients were starting to think about it casually, but the planning and the modeling in earnest are just starting to kick off now."
She has been hearing more requests from Deloitte's clients for ways to model and plan for the Pillar Two global minimum tax rules. Other Big Four firms such as Ernst & Young have also been hearing such requests from clients, as Marna Ricker, EY's global vice chair of tax, told Accounting Today during a
Giuliante has been advising clients on how to prepare for the new OECD rules as they take effect. "It's really about making sure that we're having the right conversations with our clients, not just about what they're doing today, but really focusing on the modeling and the what-if to really help them figure out where this is going to go," she said. "We're certainly seeing the volume pick up there. I expect that's only going to increase as we go forward."
Deloitte has also been keeping a close eye on developments in Washington, where the Biden administration managed to pass its own version of the 15% corporate alternative minimum tax as part of last year's Inflation Reduction Act. Congressional Republicans have registered their objections to that as well as the OECD rules. Meanwhile lawmakers in both parties are constantly introducing new tax proposals. "We are absolutely keeping our eye on what's coming down the pike in terms of pending legislation," said Giuliante.
Finding enough tax talent to deal with the ever changing tax rules is always a challenge, not only at accounting firms like Deloitte, but also at the Internal Revenue Service.
"You can hire more people and have more folks come in the door, but then the question is, how are you training those people and empowering them with tools or technologies to make them do their jobs efficiently?" said Giuliante. "We've learned this in the past. More people doesn't doesn't necessarily mean better output. We're keeping a close eye, along with our clients, on how we are going to improve the quality and ability to interact with the folks in the Service. Whether it's Pillar Two, or energy credits, or the IRS, what's the impact of technology on the work that we all do?"
With the rise of artificial intelligence programs like ChatGPT, young people are worried about whether there is a future for them in the tax and accounting profession.
"We get the question from younger folks all the time: Is technology going to eliminate my job? The answer is no, absolutely not," said Giuliante. "Technology is going to change your job, and we've been successful as leaders if we've taken the time that's freed up by technology and really trained our younger folks to be consultants and to add value to their clients."
