The speed of change and intensity of scrutiny have forced tax to the top of the boardroom agenda. It’s vital that you and your boardroom colleagues take the lead in managing the pricing, compliance, risk communication and reputational issues thrown up by this complex and uncertain environment. So how can you get on top of this whirlwind of change?
Major tax reforms used to be infrequent and would generally have taken years to come into force. But multinational businesses now face a conveyer belt of far-reaching shifts in direct and indirect taxation, both locally and as part of international developments emanating from the OECD’s Base Erosion and Profit Shifting (BEPS) action plan. The challenges are heightened by the growing oversight of multinational groups’ tax affairs from tax authorities, investors, Non-Governmental Organisations and the media.
In the past, boards might have been happy to let specialist tax teams manage the business’ tax affairs, with the key performance indicator being the Effective Tax Rate.
But faced with so much scrutiny and change, we’ve noticed that priorities now are:
- the impact on your company’s reputation with stakeholders;
- ensuring efficient and ‘no surprises’ compliance;
- how to gain certainty over the impact of tax developments; and
- the risks relating to these other three priorities – how much risk are you comfortable with and how can risk be managed in the most informed and effective way?
