The latest KPMG Global Tax Disputes benchmarking survey, in which 270 respondents participated across 35 countries, shows that, across the globe, there has been an increase in requests for information and audits with half the respondents observing that tax audits are taking longer to conclude.
Revenue authorities are taking a harder line in negotiations, with 25% observing that there is an increase in the tax authorities application of penalties globally. The majority of respondents say that tax authorities are sharing more taxpayer information and this will no doubt intensify as country-by-country reporting requirements and automatic exchange of information come into effect.
So how are South African companies responding to the swelling levels of tax disputes, and the significant reputational and financial losses they can cause?
The current survey tells us that South African tax executives and/or finance executives clearly recognise the importance of tax dispute management to their business, yet some companies are not quick enough to invest in strengthening their dispute resolution functions at a pace needed to keep up with the tax authorities. In terms of the survey, leading tax dispute management functions of tomorrow would include: