Thomson Reuters acquires Sabrix indirect tax technology

Source: Thomson Reuters website

Thomson Reuters, the world’s leading source of intelligent information for businesses and professionals, today (16th Nov) announced that its Tax & Accounting business has signed a definitive agreement to acquire Sabrix, Inc, a leading global provider of transaction tax management software applications and related services. Headquartered in San Ramon, CA, with additional operations in Oregon and London, all 160 Sabrix employees will transfer into Tax & Accounting upon the close of the transaction, which is expected in December 2009.

“This acquisition fulfills our vision of delivering a comprehensive global solution for corporations in the area of transaction tax, especially companies with a multinational presence” said Roy M. Martin, Jr., President and CEO of Tax & Accounting. “Sabrix offerings, which cover rates and rules for 170 countries, will be integrated with our existing local transaction tax software and services to form a total solution for corporate customers in the U.S., the U.K. and Europe.”

Transaction tax, also known around the world as indirect tax, VAT, GST or sales & use tax, trails only corporate and personal income taxes in its pervasiveness among country governments.

“Sabrix applications can process an unlimited number of transactions, control audit exposure, and reduce the total cost of sales tax, use tax, and VAT compliance,” said Brian Peccarelli, president of Corporate Software & Services for Tax & Accounting. “Additionally, the Sabrix Managed Tax Service™ offers finance departments of small-to-medium sized businesses an outsourced transaction tax compliance service.”

“We have collaborated with Thomson Reuters for years,” said Steve Adams, president and CEO of Sabrix. “We look forward to working alongside the well-known and respected brands of the Tax & Accounting business, including ONESOURCE and Checkpoint®, so that Sabrix clients can continue to achieve compliance with confidence in the most efficient and effective manner possible.”

SG comment: This acquisition follows Thomson Reuters taking over Digita and Abacus in the UK, and previously acquiring CrossBorder (transfer pricing software) in the US in 2007. This now makes Thomson Reuters the largest provider (by far) of tax software and technology in the UK.

Tax Jobs - Weekly Highlights

If, in amongst this downturn that we are experiencing (which I think still has a few shock waves yet to hit us) we see tax jobs being cut, I think people in the very specialists roles will potentially be the safest. When I say specialist roles, I am thinking of areas such as transfer pricing, in-house tax compliance and tax technology.

Transfer Pricing as an area has just boomed over the last 5-6 years, and many more people globally have specialised in it, and have chosen it as a successful career path. There always seems to be a global transfer pricing conference being organised at an exclusive international location, attended by the best brains in the transfer pricing world. I think also because of the onus on compliance and documentation within transfer pricing, there will be a need for it irrespective of how well business is doing.

Which brings me on to my featured job of the week, which is a specialist transfer pricing role with an economics bias within a non-Big Four niche consultancy in London:

Transfer Pricing Consultant - Niche Consultancy
London £40,000 - £70,000, depending on experience
See More Details

Tax Jobs - Weekly Highlights

This week is about in-house transfer pricing roles. It is becoming common place now for a company, whether it be a large or very large international group, to have in place an in-house transfer pricing (TP) specialist or in some cases a whole TP team. I commented on this blog back in October 2007 and in January 2008 on the growing importance and complexity of transfer pricing for a commercial Head of Tax. Like with VAT/indirect taxes or possibly an Employment Tax specialist, if a large international group does not have someone in-house dedicated to managing the group's TP issues, then the group could quickly find itself under investigation.

Tansfer Pricing Manager - Banking Group
London £50,000 - £80,000 + Bens
See More Details

Authorities challenge Glaxo's tax positions

Source: International Tax Review

GlaxoSmithKline, the pharmaceuticals company, is fighting two significant international tax battles with the authorities in the US and the UK. The Internal Revenue Service (IRS) is claiming $680 million in back taxes and interest over an intra-company financing assessment. The company reported in its annual results for 2007 that it is also in dispute with HM Revenue & Customs (HMRC) over transfer pricing issues.

The latest disputes with the tax authorities follow the settlement of a long-running transfer pricing dispute where – for an extended period – the IRS and HMRC could not agree on an outcome. The IRS would not accept that HMRC was the competent authority, which would have given British officials the right to be the ultimate arbiter on the issue.

The IRS is challenging deductions arising from intra-company financing arrangements for the years 2001 to 2003. GSK says it will vigorously contest the US tax authority's position.

"The issue relates to interest on intra-company financing that was taken as a deduction on the US income tax return," a GSK spokesman told International Tax Review. "We believe, supported by external professional advice, that this claim has no merit and that no adjustment is warranted. We strictly adhered to the IRS rules regarding intra-company debt and we feel very confident in our position based, in part, on external professional advice that we have received.

"Since this will potentially be a matter of litigation and we are still in ongoing discussions with the IRS, it would be inappropriate for us to discuss any more details at this time," the spokesman added.

The company said if it could not reach a settlement with the IRS, it did not expect the case to go to court before 2010. It would not comment on whether the issue of competent authority could emerge again in this matter.

At the same time, the company remains in dispute with HMRC over transfer pricing. "The dispute with HMRC is not on the same issue. We continue to be in dispute with HMRC primarily in respect of transfer pricing and controlled foreign companies (CFCs) matters for the years 1994 to date," the company spokesman said.

"HMRC has not yet formalised claims in respect of these matters and we are seeking to resolve them in discussions with HMRC. There continues however to be a wide difference between the group and HMRC positions, which may ultimately need to be settled by litigation," he added.

HMRC and the IRS declined to comment for this story.

In September 2006, GSK settled with the IRS in what was then the largest transfer pricing case in the US. The company paid the tax authority $3.4 billion in relation to various transfer pricing issues from 1989 to 2005.

In-House Transfer Pricing Body - CTPA

It would seem there is now an independant association for in-house transfer pricing professionals, the Corporate Transfer Pricing Association (CTPA).

It is sponsored by Duff & Phelps, a provider of independent financial advice and banking services. Its advisory board includes TP specialists from the likes of General Motors, Hewlett-Packard, Johnson & Johnson and Nike. Membership of the body is open to in-house corporate professionals whose responsibilities include TP.

Its president is Dan Peters, who is also leader of the transfer pricing practice at Duff & Phelps. So far, I can't find a live website for this new body.

I'm sure this will create another very good portal for commercial tax execs to gain information and exchange ideas within a mammoth regulatory subject.

Tax Jobs - Weekly Highlights

It's early January 2008, and typically a time of year when a number of new tax opportunities emerge in the market. Below are a couple of interesting ones that I have picked up:

Senior International Tax Manager (maternity cover) - FTSE 100 Group, London
£Flexible hourly rate
See more details


Transfer Pricing Manager - Large Bank, London
£50,000 - £80,000
See more details


I suspect that the demand for transfer pricing specialists will continue during 2008 as it does seem to be a major issue for both Heads of Tax and finance execs within business to get their heads around.