Rebecca Thompson money, tax, law...
1. New tax legislation rules for your jurisdiction
The knowledge of different countries tax systems is essential and can help you stay out of potentially difficult situations. With the new tax year in the UK being from April to April the main thing to watch out for is the government budgets for the year ahead. Each country will have different ways of delivering this information. These budgets will always discuss any tax changes and any information on investment, pensions and VAT. These yearly tax trends will either present potentially good news or bad news for your firm depending on what countries their offices are based within.
With the new president of the USA it will come with it long awaited tax reforms. These are yet to be set in stone but could potentially affect how businesses are run in the USA for years to come. This is worth looking into if you firm has business links or interest across the pond as this could dramatically affect how you do business in the USA in the future.
2. Brexit and EU reform
With the Brexit negotiations still ongoing there is still a lot of uncertainly, especially in the financial and trade markets about how this will affect firms who have business interest in the EU and the UK. Since the triggering of Article 50, the two-year process will bring about uncertainty regarding how the tax system may change in the UK and what knock on effect this may have in terms of investment into the UK. The main issue is whether UK-based firms will retain their 'passport' rights to trade in the EU post-Brexit. This is one area that is set to bring about a lot of questions rather than answers in 2018.
3. Tax transparency
Since the financial crash of 2008 the world has wanted to protect their tax base more than ever before. This means that now the tax system in your country will probably know more about tax within your business more than ever before. This intern means that big data is becoming common place which can bring with it its own problems for organisations who must publish their yearly results for the world to see. Already there are 115 jurisdictions participate in the Convention on Mutual Administrative Assistance in Tax Matters. Therefore, in recent years big organisations such as Google and Amazon have come into the spot light regarding their tax affairs due to the wealth of data that has been collected from them by governments. This means that even limited companies are having to be more careful about there tax affairs as it seems no one business can hide from the spotlight.
4. Digital technology in taxation
On Paying Taxes ranking, Nigeria moved up from 182 in 2017 to 171 in 2018 (World Bank). This was largely due to the reforms by the tax authorities. But Nigeria has a long way to go as the tax system still does not allow for tax transactions from start to finish. The ITAS which was first created in 2014, is yet to achieve this. The use of a proper digital technology platform should allow taxpayers to file tax returns, make payments, process tax clearance certificates and respond to queries without the need to go to a tax office. This means that some nations have a long way to go before they can say that they are totally ‘tax digital ready’.
5. More disputes and tax controversies
“Tax authorities will continue to be more pressure on business who are already tax compliant under even more pressure” Pwc, 2018
This in eventually will make way for increased disputes and will increase the pressure for the Tax Appeal Tribunals to be reconstituted. As it could be said this is also largely due to the increasing pressure for businesses to be more open and transparent about there tax affairs. But as tax becomes a business for ‘big data’ this will be something that will be more common place in the future.
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