This study investigates the function of data analytics tools in facilitating the digitalization of the Value-Added Tax (VAT) component within SAP, an Enterprise Resource Planning (ERP) system. The theoretical framework incorporates concepts from digital transformation theories and ERP system integration, with a specific emphasis on the utilization of data analytics in ERP settings such as SAP to enhance VAT management procedures. The hypothesis posits that the incorporation of data analytics technologies improves the efficiency, accuracy, and strategic compliance management of Value Added Tax (VAT), resulting in substantial enhancements compared to traditional VAT handling methods in Enterprise Resource Planning (ERP) systems. The research employs a case study methodology, complemented with a cross-sectional survey. The objective is to analyze the utilization of data analytics technologies in firms that use SAP for VAT administration, with a focus on understanding the integration, application, and resulting outcomes. The case study technique offers comprehensive insights into the practical uses and difficulties of adopting data analytics in SAP for VAT reasons, while the survey collects more extensive empirical data on the effectiveness and user satisfaction of such integrations across various industries. The research technique entails gathering qualitative data by conducting interviews with finance and IT specialists from specific firms. The purpose is to chronicle their firsthand experiences using SAP and data analytics in the context of VAT management. The results suggest that the incorporation of data analytics tools into SAP has a substantial positive impact on VAT administration. This is achieved through the automation of data collection and analysis, leading to a reduction in errors and an improvement in compliance with intricate tax regulations. Respondents have reported a significant improvement in operational efficiency, which includes faster processing times and enhanced accuracy in VAT computations. Nevertheless, the study also highlights obstacles to successful integration, including the requirement for specialized expertise to effectively utilize data analytics capabilities and difficulties in aligning these tools with current SAP configurations. Notwithstanding these difficulties, the general attitude towards incorporating data analytics tools into SAP for VAT purposes is optimistic, emphasizing its capacity to revolutionize VAT administration procedures in enterprises.