By Claire West
A survey by tax advisors Taxand has shown that multinational companies across the world will welcome steps towards tax simplification.
The launch of the Office For Tax Simplification by Chancellor George Osborne is expected to eliminate many of the tax complexities which act as a burden to multinational companies, both for compliance systems and day to day operations.
Frederic Donnedieu, Chairman of Taxand, said: 'In recent months we have seen a number of countries, including the UK, look to lower their rate of corporate income tax as a measure to attract foreign investment. However, a number of jurisdictions have wrongly viewed this as the ‘be all and end all’ in terms of attracting investment, when other factors also have a large part to play'.
'In a survey we conducted across Taxand advisors in 20 of our 50 countries, nearly half (48%) identified complex tax rules and legislation introduced by governments and tax authorities across the globe as the key disincentive in attracting investment'.
'Surprisingly, just 20% believed that high corporate income tax rates were the most important factor in discouraging inward investment'.
The survey also revealed that the clarification of tax rules and legislation by governments and tax authorities was the most effective technique for attracting inward investment, with 35% of responses relating to such actions.
Mr. Donnedieu said: 'Today’s announcement in the UK is a welcome first step in the global simplification of tax systems and is likely to fire the gun for other jurisdictions who will seek similar reforms to ensure they are competing on an equal footing for foreign investment'.
If you would like a full copy of Taxand’s survey on inward investment then please contact Hogarth using the details below.
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