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Many countries are overhauling their corporate tax rules ahead of the final recommendations from the Organisation for Economic Cooperation and Development (OECD) on base erosion and profit shifting (BEPS), according to a report from big four accountancy EY.
Many countries are overhauling their corporate tax rules ahead of the final recommendations from the Organisation for Economic Cooperation and Development (OECD) on base erosion and profit shifting (BEPS), according to a report from big four accountancy EY.
The document, The Outlook for Global Tax Policy in 2015, draws on the views of the company’s tax policy heads in 32 countries to identify key trends for the year ahead.
It points to national policy shifts, with 40% of respondents citing “significant” tax reform activity while final BEPS recommendations are pending, and 34% countries having enacted legislation, or planning to do so, to tackle hybrid mismatch arrangements.
EY’s head of global tax policy, Chris Sanger, said, “With the acceleration of initiatives such as the BEPS project, policymakers are choosing to react now and adapt later, rather than waiting for recommendations. This has been described as bizarre by members of the OECD and adds to increasing tax uncertainties facing businesses in 2015.”
The accountancy giant’s data suggest a continuing trend towards broad-base, low-rate business tax regimes; although nearly a third of respondents (31%) said they expected the overall corporate income tax burden in their countries to increase in 2015.
As policymakers anticipate further BEPS developments in 2015, the trend for taxpayer scrutiny is set to accelerate. The EY report highlights how governments are launching new transparency requirements, such as country-by-country reporting, with ten nations (31%) reporting increases in enforcement measures for the year ahead.
