2014 Deloitte Asia Pacific Tax Complexity Survey Report
SINGAPORE, April 7, 2014 — For a nation that strives to be amongst the world’s most competitive and business friendly economies, it comes as no surprise that Singapore scored well in a survey on tax complexity, with a high number of respondents indicating that Singapore’ tax environment has a good or high level of consistency and predictability.
Deloitte released its 2014 Asia Pacific Tax Complexity Survey Report today, which highlights key tax trends facing businesses operating in the region. The report surveyed over 800 financial and tax professionals in 20 jurisdictions across Asia Pacific.
In the survey, a follow-up to the inaugural 2010 report, one of the key findings this year was that businesses are placing greater focus on consistency in tax policies than complexity and predictability when deciding to enter or exit a market in Asia Pacific. This finding is a reversal of the 2010 study where businesses placed greater emphasis on complexity and predictability of tax policies then.
The definition of these three terms as follows:
Key survey findings:
“The principles of tax consistency, complexity and predictability increasingly influence the decision of corporates as to whether they will invest in a market. What we have found is that tax regimes in Asia Pacific have got increasingly more complex, bringing with it risk and uncertainty to businesses operating in the region. With the OECD's Base Erosion and Profit Shifting project ("BEPS") set to bring sweeping changes to the tax landscape, I expect even greater complexity—but also opportunity—in the future. ” said Alan Tsoi, Deloitte’s Asia Pacific Regional Managing Director for Tax and Legal.
Low Hwee Chua, Tax Services Leader for Deloitte Singapore & Southeast Asia, also shared that “The survey reinforces the point that Singapore is one of the easiest countries to do business in, with our tax policy being viewed as one of the most consistent, most predictable and least complex in Asia Pacific. This is definitely a well-deserved reputation and the Singapore Government can be proud of this achievement as it is a tough balancing act to ensure that tax policies address both business and country needs. Going forward, however, it would be increasingly challenging to do so in view of the various BEPS initiatives that are expected to be introduced to address the issues of tax base erosion and to improve tax transparency. However, it is encouraging to see that survey respondents appear positive about Singapore and have indicated that Singapore’s tax environment is unlikely to experience material change in the near term.
On a wider level, respondents generally felt that many tax bureaus in the region are not sufficiently equipped to deal with today’s business complexities. Tax inspector training and increased speed and resolution of tax audits should be a priority of such governing bodies.”
To download a copy of the full report, please click here.