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18 October 2018

More digital tax administration means more risks for boards to consider

As tax authorities demand more data, faster, companies may have unpleasant results including disruption, operational risks and “surprise” audits. Tax administrations around the world are going digital at a rapid pace. More and more often, they are creating new capabilities to interact with taxpayers at source, instead of relying on historical information from the tax return. In some cases, they are actually demanding taxpayer data even before a transaction has occurred, turning the whole model of tax compliance on its head. When combined with the global revolution in tax transparency, companies old and new are finding that revenue authorities everywhere are forging ahead at a pace that has the potential to outstrip their ability to keep up. The results can be unpleasant and include internal disruption, operational risks, “surprise” tax assessments or audits, financial penalties and reputational risk. Boards and senior executives may not be aware of quite how high the new risks may be. This EY Article provides details.

Document ID: 2018-6215

 
 

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