In a world of comprehensive transparency, global tax authorities are using transparency to respond to a perceived political urgency in requiring multinational enterprises to pay their ‘fair share’ of taxes. Tax authorities also are increasingly using publicly available information generated by new technologies and 24/7 media to question underlying facts supporting corporate tax positions. In addition, tax authorities are crowdsourcing company information across multiple industries and jurisdictional borders to challenge tax positions, make adjustments, and impose penalties.
Companies should be prepared with a well-coordinated communication strategy around sharing tax-related information with governments, regulators, investors, and the public. Tax authorities and the media expect proactive transparency and comprehensive reporting from multinational enterprises with diverse tax structures. Businesses should seek to manage their reputational risks by researching and analyzing publicly available information regarding their operating structures and tax positions.
In particular, businesses should consider the following questions:
Health Industry & Pharma Life Science Tax Leader, PwC US