Ms Seah Siew Yun, Senior Tax Executive Director of Grant Thornton Malaysia said, “Reducing liabilities across borders can offer significant tax savings so it is interesting to see how open business leaders are to improving guidance and global co-operation. In the UK, recent high-profile cases involving Amazon, Google and Starbucks have certainly sharpened public opinion as to what is acceptable tax planning”.

Kuala Lumpur, 6 June 2013- The vast majority of businesses would welcome more guidance from tax authorities on what is acceptable and unacceptable tax planning, even if this provides less opportunity to reduce tax liabilities across borders, according to the latest research from the Grant Thornton International Business Report (IBR), a quarterly survey of more than 3,000 businesses in 44 countries.

The IBR reveals that 68% of businesses globally would like more tax guidance. Business owners in Malaysia (92%) rank high in the survey of this category. Neighbouring countries like Singapore (88%) and Thailand (74%) expressed their need to welcome more global co-operation and tax guidance from the tax authorities.

Ms Seah Siew Yun, Senior Tax Executive Director of Grant Thornton Malaysia said, “Reducing liabilities across borders can offer significant tax savings so it is interesting to see how open business leaders are to improving guidance and global co-operation. In the UK, recent high-profile cases involving Amazon, Google and Starbucks have certainly sharpened public opinion as to what is acceptable tax planning”.

In the survey, it is also revealed that many businesses in the ASEAN region are now considering greater transparency and making its tax affairs more open to investors.

According to the results from the IBR, businesses are planning to make their tax affairs more transparent to investors, stakeholders and the general public. Countries from ASEAN region are in higher agreement for more transparency with Vietnam (94%), Malaysia (92%), Philippines (86%), Singapore (84%) and Thailand (80%). Those in least agreement are Japan (7.7%), Estonia (10%), United Kingdom (12.8%), Australia (13.3%) and Norway (14%).

When asked about what should be the main source of tax revenue for the government, most business owners in Malaysia expressed that at the present time it should be company tax (64%), followed by GST (14%), Sales Tax (10%), personal income tax (8%), and other excise duty or non-tax (4%). On global basis, the most answered source would be company tax (25.2%) and GST (27.4%).

Business leaders are also concerned of what the tax regimes in their economies are set up to achieve. Just 31% globally said their local tax laws and policies were geared to stimulate economic growth.

Tax is a cost to businesses in its simplest form. It is unsurprising to see few associate it with economic growth. In fact, many mature economies around the world are undergoing severe fiscal retrenchment and business leaders are seeing taxes rise even as growth remains flat. The IBR also reveals that globally, 41% of businesses do not believe their tax regimes are sufficiently redistributive.

 

 

For more information please contact:

Sharon Sung, Technical and Corporate Affairs Partner, T  +60 3 2692 4022, 

sharon.sung@my.gt.com

 

Charmane Koh, Corporate Affairs Assistant Manager, T  +60 3 2692 4022, 

charmane.koh@my.gt.com