2017 saved the best until last.The end of the year saw a series of breakthroughs, with the EU-UK Brexit negotiations moving forward, and the approval in the US of a law to comprehensively reform the US tax code, having ping-ponged back and forth between House and Senate.
And so,the United States has managed its first major tax code shake-up since the 1980s, and one of the largest tax cuts in its history, givingTrump the best Christmas present he could have hoped for, after a year of legislative frustrations – a gift that will keep on giving you might say, especially if it results in the economic growth that Republicans are expecting and the boost in tax revenues.
While much commentary on the subject has focused on the domestic impact of the plan, US tax reform has triggered a wave of soul-searching by government ministers … Read More »
Never underestimate the power of negative publicity. Especially in the age of social media. Words of bad deeds can travel at the speed of light these days, and if, as an individual, a company, or even a country, you are on the wrong end of a public relations backlash, you may have no choice but to appease your accusers.
Multinational companies are increasingly worried about the reputational impact of negative exposure of their tax affairs in the media. Indeed, last year, Taxand surveyed chief financial officers and tax finance directors across Europe, Asia, and the Americas and found that 91 percent of respondents felt media scrutiny of their tax planning activities had a negative impact on their public standing compared with 51 percent in 2011 and 77 percent in 2015.
Although Facebook didn’t explicitly say so, it seems likely that the increasingly … Read More »
In what can also be described as something of a breakthrough for Africa’s future economic prospects, ministers agreed on December 2 – possibly around the same time as the US Senate was burning the midnight oil over tax reform – to form the Continental Free Trade Area (CFTA).
The CFTA is being touted as a massive opportunity for Africa. One of the main reasons cited for the region’s slow pace of economic development isn’t so much it’s lack of trade with the rest of the world, but its well-known inability to trade with itself. As Marc Yombouno, Minister of Trade of the Republic of Guinea, observed at the end of the talks in Niamey, Niger, intra-African trade represents only about 16 percent of the continent’s total trade, whilst in Asia and Europe, intra-regional trade is more like 50 to 60 percent.
This … Read More »
Major tax reform efforts are often undertaken with the intention of making life easier for taxpayers. But they can be enormously disruptive for tax planning in the short-term, as taxpayers adjust to life under a new regime. Spare a thought then for taxpayers in India. There, they are still getting used to the idea of the national goods and services tax, often described as one of the most significant economic reforms in India’s post-colonial history. Now they could be faced with a shake-up of direct taxation as well.
By putting in place the GST regime this year, the current Government was congratulated for achieving in three years what the previous administration failed to do in ten. Will it be able to pull off a similar achievement with the direct taxes code?
Reforming the outdated direct tax regime in a similarly expedient manner would represent … Read More »