Tax Leaders’ Strategic Influence Grows as Regulatory Complexity Concerns Double

Amid significant tax policy changes at the domestic and international levels, the 2026 BDO Tax Strategist Survey, released today, finds that regulatory complexity has emerged as the number one enterprise tax risk. Thirty percent of tax leaders now cite it as their greatest source of tax risk — more than double the 13% who said the same in 2025. At the same time, many organizations are still building the structural readiness needed to meet the moment: only 38% have a defined process for cross-functional teams to engage the tax function on matters that may carry tax implications, which may limit tax leaders’ ability to mitigate financial risks, strengthen resilience, and deliver strategic guidance.

The survey, conducted in early 2026, draws on responses from 300 senior tax leaders at middle market organizations. The data reveals that tax leaders continue to serve as strategic leaders within their organizations, even as they navigate tariff volatility, OBBBA implementation, global tax reform, and rapid technological change.

“The pace of regulatory change, global economic shifts, and business transformation has made tax one of the most strategically important functions in an organization,” said Mathew DeMong, National Managing Principal of Tax at BDO USA. “The opportunity is real, but so is the risk: without the right processes, infrastructure, and organizational integration, tax’s impact remains person-dependent and reactive. Leaders who institutionalize the tax function across the enterprise will be better positioned to bring a total tax approach to every business decision.”

The BDO report also finds that tax's influence continues to grow in critical areas of business strategy. In line with last year’s report, tax leaders continue to report high levels of involvement in enterprise decision-making. Ninety-four percent of tax leaders report being asked to weigh in before business decisions are made — up four percentage points from the prior year. Involvement in strategic transactions such as mergers and acquisitions has increased by nine points, while involvement in organizational risk management has increased by five points.

The report also uncovers several key findings related to tax’s operating models, technology investment, and regulatory complexity at the state, federal, and global levels:

• Fifty-four percent of tax teams are responding to increased risk by investing in outsourcing and co-sourcing. The share of organizations outsourcing primarily due to regulatory and compliance requirements grew from 33% in 2025 to 47% in 2026.
• Seventy-nine percent of tax leaders plan to increase technology investment this year, but 29% cite both interoperability with legacy systems and implementation ahead of data management readiness as the top reasons technology initiatives fall short of expectations. While enterprise leaders recognize the potential of AI and automation to fundamentally change how the tax function operates, the data reveals that most are not leveraging the technology for the complex analysis necessary for planning, forecasting, and navigating today's compliance landscape.
• Despite ongoing tariff exposure, most organizations have not yet broadly deployed the management strategies available to them. Forty-nine percent of respondents report pursuing transfer pricing reviews, while 42% report conducting a tariff code review and 25% report pursuing duty drawback strategies.
• Eighty-six percent of tax leaders say implementing tax provisions in OBBBA is a challenge. State decoupling from federal OBBBA provisions introduces additional complexity. Varying regulatory and compliance requirements by jurisdiction compound the issue, with state and local income and franchise tax cited as the largest contributor to total tax liability by 36% of respondents.
• Ninety-two percent of multinational tax leaders say global tax complexity has substantially increased in the past two years. Multinationals cite both OECD Pillar Two requirements (88%) and transfer pricing audit activity (87%) as key challenges. Ninety-three percent of multinational tax leaders say that global tax complexity has led to increased costs, and 91% say that it has increased their reliance on external advisors and technology solutions.

Access the "2026 BDO Tax Strategist Survey" here.

Source: BDO

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