Changing tax landscape: impact on your organisation
The global taxation and regulatory landscape is changing as a result of new legislation, tax management regulations, codes of conduct, and anti-avoidance initiatives. Governments are using tax measures to encourage environmentally friendly behavior in line with the societal norm, increasingly encouraging the use of sustainable and renewable energy. Sustainability is no longer limited to a green environment or climate. It includes issues such as remuneration structures, contributing a fair share to society, and achieving strategic and commercial ambitions in an ethical manner. Consequently, companies must actively manage opportunities and risks to increase their market value and avoid reputational damage.
For multinational enterprises (MNEs), it is important to prioritize reviewing their tax strategy. It is vital to identify potential risks due to changes (such as sustainability reporting, the CBCR regulations, and the obligations of the second pillar of the OECD initiative, which imposes a global minimum tax rate of 15%) within the tax environment. Only then can you assess the impact of changes in the tax landscape on your business activities. It is a multifaceted and complex area that requires the attention of every business.
Some common challenges include:
- How much has my company contributed to energy-saving measures, environmental sustainability, and innovation? And what are the applicable sustainable tax incentives, energy taxes, and local taxes?
- To what extent is my company generating and/or using renewable energy, emitting less CO2, investing in environmentally friendly techniques/means of production, and reducing its reliance on fossil fuels?
- To what extent has our sustainable (tax) strategy been implemented, monitored, and evaluated?
- Is my tax department already using technology and data?
- Is my company prepared for the growing demand for transparency in reporting and communication?
