While the U.S. tax landscape has undergone historic changes in the past 18 months, rule transformations moving forward around the world will likely deliver even larger tax compliance challenges in the months and years to come.
New, and newly proposed, tax rules and reporting requirements are occurring from Brazil to Bahrain, from Spain to Singapore, and from Turkey to Taiwan. While these new and emerging shifts vary in nature and magnitude, most of the changes ultimately require corporate tax departments to access, analyze and ensure the accuracy of far more data in a quicker manner – much quicker, in many cases. This is certainly the case for the real-time (or near real-time) tax and transactional data reporting requirements in Spain, Hungary and a growing number of other countries.
The rise of real-time tax reporting requirements figures as one of several important areas to monitor in the fast-changing global tax landscape. The European Union’s (EU’s) overhaul of its aging value-added tax (VAT) system – rules governing intra-EU trade that were not intended to be permanent when adopted in 1993 – is progressing with major changes set to come into force during the next 24 months.
Individual EU countries, such as France and one soon-to-be former EU country (U.K.), also have announced plans to enact new rules and rates for e-commerce transactions. New regulations concerning taxes on digital transactions are some of the most important global tax matters to monitor. How these new rules are implemented will have major implications on corporate tax departments and their supporting technology. A multilateral approach to digital taxation rules, which the OECD espouses and has been working to advance for several years, likely would result in more harmonization among different countries and regions and, as a result, less complexity from a tax management perspective. On the other hand, a unilateral approach, which more countries now appear bent on taking, would result in much more tax management complexity along with higher risks of double taxation.
Global companies already contend with a significant level of tax compliance complexity. The U.S. Supreme Court’s 2018 Wayfair decision, for example, has sparked a flurry of state-specific sales and use tax changes that all global retailers who sell to U.S. customers must continuously monitor and comply with.
After tax leaders assess looming changes on the global tax rules horizon, they should turn their scrutiny to their tax technology to determine the extent to which it can help them respond quickly and accurately to more historic changes coming down the pike.
About the Author
Marc Duclos is Global Partner Leader for Oracle at Vertex, with responsibility for managing the relationship across the various Vertex Solutions and the Oracle ecosystem. Delivering customer success through strategic partner solutions is a key focus in Marc’s role. He has over 20 years of channel management, business development and field marketing experience through his prior roles at BEA Systems, Oracle and KPMG. Focus areas: Partner development, strategic channel initiatives, customer success.
OATUG Tax Series
Open to everyone! Be our guest for this series of educational webinars. Explore ways to manage your tax obligations and simplify compliance:
OATUG Tax Series: Simplifying the Complex World of the Global Tax Landscape with Oracle ERP Cloud and Vertex Solutions
June 25, 2019
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OATUG Tax Series: Case Study – Vertex and Equinix Partnering to Tackle the Complex Global Tax Landscape
July 24, 2019, 1:00 p.m. EDT
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