Tax Service Line – Big Four Accounting Firms
The tax service line, forms about a quarter of the Big Four firm revenue and generally holding this percentage level across the years. Tax revenue are reasonably steady, as they derive revenue from add-on services provided to audit clients, in addition to tax services provided for transactions, complicated tax restructurings and other projects. Tax had a very strong growth in 2006 to 2008, in line with large scale global merger and acquisition transactions activity, but posted a sharp decline in 2009 of 7%.
Tax revenues further declined by 1.2% from 2009 to 2010, with Deloitte falling by more than 5% and E&Y also declining, offset somewhat by revenue increases in this service line at KPMG and PwC. 2011 was a different story altogether – combined Tax revenues of $22.3 billion in 2010 jumped a strong 7.1% to $23.9 billion in 2011. KPMG Tax grew a remarkable 13%, while Deloitte Tax grew the slowest at 5.2%.
Combined Tax revenues of $23.9 billion in 2011 jumped another solid 5.6% to $25.0 billion in 2012. In general, the service line performed solidly for all firms in 2012, continuing on the good pace set in 2011. The growth rates for all firms was generally between 3.6% to 8.0%.