What's on a Head of Tax's mind currently?
Tuesday, 9 October 2007
Source: Bob Reynolds, editor of International Tax Review (8 October 2007)
I asked a group of eminent tax professionals recently what were the most pressing tax issues on their desks at present. As you might expect, transfer pricing emerged as the consistent number one. The sheer complexity of transfer pricing issues and the unpredictability of outcomes was a familiar theme.
The second topic was tax audits. One global tax director said: 'What gets me is the fact that often revenue authorities do not understand our business. They do not appreciate how we arrive at our assumptions for tax due and therefore they decide to impose a stringent tax audit.'
He says that these audits rarely reveal anything. So the authority in question is no better off at the end of the process. An illusion of activity has been created and nothing else.
'They still have no greater appreciation of where we are and so they sit and gestate for six months. Then they put in another audit. This can go on two or three times.'
He points to the absolute frustration of being involved in an exercise which is time-consuming and expensive but which is generally fruitless. I have found echoes of this theme throughout the world.
I asked a group of eminent tax professionals recently what were the most pressing tax issues on their desks at present. As you might expect, transfer pricing emerged as the consistent number one. The sheer complexity of transfer pricing issues and the unpredictability of outcomes was a familiar theme.
The second topic was tax audits. One global tax director said: 'What gets me is the fact that often revenue authorities do not understand our business. They do not appreciate how we arrive at our assumptions for tax due and therefore they decide to impose a stringent tax audit.'
He says that these audits rarely reveal anything. So the authority in question is no better off at the end of the process. An illusion of activity has been created and nothing else.
'They still have no greater appreciation of where we are and so they sit and gestate for six months. Then they put in another audit. This can go on two or three times.'
He points to the absolute frustration of being involved in an exercise which is time-consuming and expensive but which is generally fruitless. I have found echoes of this theme throughout the world.
Labels: Head of Tax, market view, tax news
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