How Technology and AI are Driving Growth and Advisory Shifts in the 2025 Accounting Landscape

The Thomson Reuters Institute has released its 2025 State of Tax Professionals Report, highlighting a significant shift as firms leverage technology to move from routine compliance to high-value advisory services. Global accounting firms reported an average revenue increase of 21.3% and a 25% profit rise in 2024, largely attributed to the strategic automation of traditional tax-preparation tasks. This evolution is critical for the sector as it addresses persistent talent shortages and the need for greater operational efficiency through AI-driven solutions.

According to the 2025 State of Tax Professionals Report, the accounting and tax sector is undergoing a profound transformation as firms embrace automation to supercharge business growth. By automating routine tax-preparation work, firms have successfully diversified their offerings into lucrative areas such as tax strategy and business consulting. This strategic pivot has yielded substantial financial results, with firms worldwide recording an average revenue gain of 21.3% and a profit increase of 25% over the past year.

Despite financial gains, the industry faces significant hurdles, most notably the difficulty of attracting and retaining quality talent. To combat this, firms are increasingly turning to technology to fill skills gaps and allow senior staff to focus on high-level tasks. While keeping up with changing regulations remains a challenge, investment in artificial intelligence is the only budget category expected to see a significant increase in 2025. Approximately 49% of survey respondents indicated that technology is a central component of their plans to improve profitability in the coming year.

The report emphasizes an aggressive push for growth, particularly among midsize and large firms that are competing for high-value clients. Technology is cited as both a necessity and an enabler in this environment, providing the data-analysis tools required for sophisticated advisory services. As firms navigate the complexities of integrating AI-driven solutions into existing workflows, the ability to balance operational efficiency with client responsiveness will likely determine which practices flourish in an increasingly competitive market.