A new survey of CFOs and tax directors from across Europe, Asia and the Americas found 55% have altered their tax plans, or delayed decisions, as they await details of potential US tax reforms. The survey was carried out by Taxand, the international tax advisory firm, at its recent conference in Frankfurt.
Tim Wach, managing director at Taxand, described US multinationals as ‘scrambling in the dark’ over the potential impacts of ambitious Republican plans for a ‘border-adjusted cash flow tax’. First proposed in June 2016, this new corporate tax would be applied to goods and services consumed in the US, based on revenues from domestic sales in the US, with deductions given for certain domestic cash outlays, while imported, foreign-based inputs would not be deductible.
Speaking in June at the OECD international tax conference in Washington, Pascal Saint-Amans, director of the OECD’s centre for tax policy and administration, said that the OECD supports US tax reform ‘as long as it doesn’t disrupt trade, which was the big fear with the border adjustment tax’.
The great majority (96%) of those surveyed said they expect increasing global tax transparency to increase the costs of compliance. Companies cannot ignore the reputational impacts of increased transparency, said Wach, who stressed that when firms are deciding their tax policy, they must be ‘willing to stand behind any decision’.
Over two thirds (69%) of respondents have seen tax audits and investigations become more aggressive over the last year. As Jason Collins, partner at Pinsent Masons, pointed out in an article for Tax Journal in May, HMRC has stepped up its criminal investigations into corporates in the UK without waiting for the new corporate offence of failing to prevent the facilitation of tax evasion to become effective. The likely start date is September, when HMRC will begin to receive data from the 51 ‘early adopters’ of the common reporting standard.
A new survey of CFOs and tax directors from across Europe, Asia and the Americas found 55% have altered their tax plans, or delayed decisions, as they await details of potential US tax reforms. The survey was carried out by Taxand, the international tax advisory firm, at its recent conference in Frankfurt.
Tim Wach, managing director at Taxand, described US multinationals as ‘scrambling in the dark’ over the potential impacts of ambitious Republican plans for a ‘border-adjusted cash flow tax’. First proposed in June 2016, this new corporate tax would be applied to goods and services consumed in the US, based on revenues from domestic sales in the US, with deductions given for certain domestic cash outlays, while imported, foreign-based inputs would not be deductible.
Speaking in June at the OECD international tax conference in Washington, Pascal Saint-Amans, director of the OECD’s centre for tax policy and administration, said that the OECD supports US tax reform ‘as long as it doesn’t disrupt trade, which was the big fear with the border adjustment tax’.
The great majority (96%) of those surveyed said they expect increasing global tax transparency to increase the costs of compliance. Companies cannot ignore the reputational impacts of increased transparency, said Wach, who stressed that when firms are deciding their tax policy, they must be ‘willing to stand behind any decision’.
Over two thirds (69%) of respondents have seen tax audits and investigations become more aggressive over the last year. As Jason Collins, partner at Pinsent Masons, pointed out in an article for Tax Journal in May, HMRC has stepped up its criminal investigations into corporates in the UK without waiting for the new corporate offence of failing to prevent the facilitation of tax evasion to become effective. The likely start date is September, when HMRC will begin to receive data from the 51 ‘early adopters’ of the common reporting standard.
