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More agile tax models are needed in the face of an evolving landscape including global uncertainties, impacts from the Biden administration, Tax Reform and Wayfair to allow the tax function to effectively provide critical inputs in business decisions. Companies should consider:
Effective cash tax management through minimizing taxable income, obtaining available refunds, and reducing required tax payments
Actions to stabilize supply chains while bracing for an unpredictable revenue and profitability mix in key markets
Resources needed to meet your ongoing indirect and direct tax compliance requirements, imposed by the various taxing authorities
Opportunities focused on becoming more flexible in responding to arising uncertainties
Whether state corporate, partnership, sales tax or unclaimed property, navigating the evolving compliance process has always been challenging. Now, businesses must take what was put into place post-federal Tax Reform and post-Wayfair and adapt it to a rapidly changing situation. Meeting this challenge will require a new vision of how we work and what we are trying to accomplish.
In the world of state and local tax, we see many developments each year, but the US Supreme Court’s 2018 decision in Wayfair v. South Dakota and the 2017 federal enactment of the Tax Cuts and Jobs Act (TCJA) stand out by changing the landscape for taxpayers across industries. Five years after Wayfair and the TCJA, state tax professionals should be watchful, insightful, and resourceful. Certainly, there are challenges but in meeting these challenges, savings and opportunities may be uncovered.
State and local tax professionals need a strategy to stay ahead of and manage state and local tax burdens and to identify opportunities that result from evolving changes in legislation and administrative policy changes.
PwC’s State and Local Tax (SALT) practice can help you with strategies to manage your state and local tax issues by recommending solutions that are consistent with your company’s overall business objectives. We can also identify appropriate tax treatment that is consistent with good business practices and states’ applicable tax laws and rules.