Sep 28, 2026 · 12 min · 6 segments
Moving an old process onto software isn't innovation; changing the process itself is. Richard Sergeant of Principle Point tells the AccountingWEB podcast why e-invoicing could deliver what Making Tax…
So in your most recent piece, then, you've argued that while governments can force taxpayers to use software, a recent example being making sex digital for income tax here in the UK, this doesn't actually mean it will generate guaranteed innovation.
The digitalization or digitization, I'm sure we'll talk about that a little later on, the digital journey that tax authorities have been on for the last 15, 20 years or so has really fascinated me.
And I have been, until very recently, a big proponent of the idea that a lot of the interesting stuff that happens in the world of accounting technology is actually on the coattails of regulatory change.
So in that way, kind of innovation comes from the fact that the ability for tax authorities to take advantage of new software and new infrastructure that's out there.
And things like MTD and various guises of it are kind of good examples of that here in the UK.
And so we kind of have this idea that the world follows because, you know, HRC says something has to happen.
And then the accountants and the clients have to kind of marshal themselves behind that to kind of make it happen and to get going.
And it wasn't really until MTD IT kind of really kind of kicked in that I started to question that.
And especially off the back of some recent comments really about this idea of innovation and innovation being really kind of being shown to kind of exist out there at the moment because of all the changes.
And I questioned it and all I could see was actually that we're not innovating, we're just creating digital ways of doing processes that have existed for a long time.
The way that we deliver the VAT return has changed, but it hasn't changed the underlying processes or kind of delivered any kind of great transformation off the back of it.
And in many ways, although I don't touch on the article, it actually extends the world of cloud technology too.
The promise of cloud hasn't really been delivered in terms of real productivity gains anywhere.
And I know there's been other drags on productivity in the UK over the last 10, 15 years or so, but with this, what seems a relentless rise of digital The results don't seem to have made an impact or a positive impact or done anything to kind of really contribute towards that productivity.
And I start to unpack this idea of why I think that this idea of innovation doesn't exist off the back of regulatory change in a bit more detail.
So in your most recent piece, then, you've argued that while governments can force taxpayers to use software, a recent example being making sex digital for income tax here in the UK, this doesn't actually mean it will generate guaranteed innovation.
The digitalization or digitization, I'm sure we'll talk about that a little later on, the digital journey that tax authorities have been on for the last 15, 20 years or so has really fascinated me.
And I have been, until very recently, a big proponent of the idea that a lot of the interesting stuff that happens in the world of accounting technology is actually on the coattails of regulatory change.
So in that way, kind of innovation comes from the fact that the ability for tax authorities to take advantage of new software and new infrastructure that's out there.
And things like MTD and various guises of it are kind of good examples of that here in the UK.
And so we kind of have this idea that the world follows because, you know, HRC says something has to happen.
And then the accountants and the clients have to kind of marshal themselves behind that to kind of make it happen and to get going.
And it wasn't really until MTD IT kind of really kind of kicked in that I started to question that.
And especially off the back of some recent comments really about this idea of innovation and innovation being really kind of being shown to kind of exist out there at the moment because of all the changes.
And I questioned it and all I could see was actually that we're not innovating, we're just creating digital ways of doing processes that have existed for a long time.
The way that we deliver the VAT return has changed, but it hasn't changed the underlying processes or kind of delivered any kind of great transformation off the back of it.
And in many ways, although I don't touch on the article, it actually extends the world of cloud technology too.
The promise of cloud hasn't really been delivered in terms of real productivity gains anywhere.
And I know there's been other drags on productivity in the UK over the last 10, 15 years or so, but with this, what seems a relentless rise of digital The results don't seem to have made an impact or a positive impact or done anything to kind of really contribute towards that productivity.
And I start to unpack this idea of why I think that this idea of innovation doesn't exist off the back of regulatory change in a bit more detail.
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