Australia

Details

  • Service: Tax, Corporate Tax, International Corporate Tax
  • Type: Regulatory update
  • Date: 10/10/2013

Tax Insights

KPMG's analysis of tax issues and developments.

Glenn Jackson

Glenn Jackson
Director, Tax

+61 3 9288 6680

glennjackson@kpmg.com.au

Global tax compliance efficiency – a universal challenge 

by Glenn Jackson, Corporate Tax Specialist

Last week I was fortunate enough to travel to Seoul to present on emerging trends in tax governance and tax compliance transformation. It occurred to me that despite the obstacles in translating English to Korean and the fact that I was over 9,000 kms from home, the global compliance challenges facing Korean multinational organisations are no different to those experienced by Australian multinationals.

Tax functions experience the same pressures: a heightened regulatory environment stemming from the need for global tax authorities to grow their revenue base and an increasingly complex business environment where tax functions continue to be asked to do more with less resources.

 

In 2012, KPMG updated its Good, Better, Best benchmarking survey on global tax management trends. The findings from the survey will not surprise. In the immediate future, tax functions in the Asia Pacific region will spend close to 50 percent of their time on compliance and management of tax authority audits whilst only 8 percent will be spent on integrating with business groups. The survey also reports that only 8 percent of tax functions say they were focused on process or technology improvements in the area of compliance.

 

So a key message coming out of the survey is a picture of a global tax function very clearly focused on compliance with the management of tax efficiency and business support aspects of its role receiving a lower priority and investment of time.

 

There is emerging evidence that multinationals are prepared to move from an ad hoc approach to a transformative approach to compliance. Outsourcing as a route to transformation is becoming more prevalent as organisations seek global management, control and visibility over their tax affairs, process improvements and finally access to more innovative technology.

 

The healthy debate over centralisation vs. local delivery, outsource or co-source, will continue for some time but it is reassuring in our discussions with multinationals that there is an awareness of the need to change the way tax functions are designed, executed and continually improved.

 

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