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Too aggressive?
The worldwide trend among multinational corporations towards moving their operations from high tax to low tax regimes has accelerated in the past year, according to a survey at this year's KPMG international tax conference in Berlin. A poll took place among senior tax executives from 120 multinational corporations; 62% reported that they were planning to move assets or operations to low tax regimes. This is a significant increase on the 55% who gave the same answer in a poll in 2005.
Too aggressive?
The worldwide trend among multinational corporations towards moving their operations from high tax to low tax regimes has accelerated in the past year, according to a survey at this year's KPMG international tax conference in Berlin. A poll took place among senior tax executives from 120 multinational corporations; 62% reported that they were planning to move assets or operations to low tax regimes. This is a significant increase on the 55% who gave the same answer in a poll in 2005.
This year, 14% said that they had already moved part of their operations to a lower tax regime in response to more aggressive tax planning challenges from tax authorities. The US was seen as the most aggressive, followed by the UK and Germany. Loughlin Hickey, KPMG's global head of tax, said that this showed 'that tax rates are important', but are not everything when it comes to deciding where to site operations. He said further that 'if companies find a country in which relations with the tax authorities are conducted in a constructive and predictable way, they may accept a higher tax rate and more contact with the authorities as a reasonable cost of doing business'. Over 70% of those polled said that 'they had reacted to more aggressive challenges by the authorities by becoming more sophisticated in their tax planning and management of tax processes'.
