I was at a seminar yesterday where a person more familiar with the workings and politics of international tax than I am suggested that if Donald Trump adopts the Paul Ryan corporation tax plan for the USA then the whole international tax system will be blown apart. BEPS and all the work done in the last few years would then become a footnote in tax history unless, perhaps, the EU were to take that work forward. He thought that unlikely when the current EU Presidency is held by Malta, which is unambiguously a tax haven.
At the same seminar I spoke about the systemic risk to financial capitalism arising from mistrust in global corporations that is largely expressed through cncern about their tax arrangements, focussing on the use of tax havens.
It was, I confess, like talking to the deaf. Businesses representatives present wanted to talk about the minutiae of regulations. Accountants still have not get their head around the need for accountability, and most especially country-by-country reporting (“too much information”). Deck chair rearranging is still going on in international taxation.
My conclusion? Many of the supposedly brightest and best who populate the upper echelons of our business communities have no idea of the tidal wave of chaos and disorganisation that may be heading their way. Worse, their parameters are set so narrowly they can't manage thinking about these issues: business as normal is all they can understand. And that may be a long way removed from the world we're about to get in the US, EU and beyond.
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Join the queue, Richard. Businesses haven’t got their heads round GDPR yet, and that IS coming, no question. To expect them to look seriously at corporation tax issues as well is asking too much of the average board member.
Sounds very discouraging. I was hoping Tax was one of the few areas where things were moving in the correct direction. I keep on hoping the Trump presidency won’t be as bad as I fear. I haven’t been so worried about any president since Regan.
Me neither
And I remember concern about him, all too well
I agree about Trump – it is not looking good.
However I take heart from the fact that the people he has pulled into his administration are an even worse bunch than whom George Bush Jnr surrounded himself with.
It can only mean things may actually get worse – more possibility of war with China and Iran for example. The homeland tactic will be to carry out some of the promises like the wall with Mexico and repatriate some manufacturing output back to the USA (also these policies will be aimed at the key states that make success in the electoral college system more likely for obvious reasons) but I do believe that overall life in the USA will get harsher.
Trump may last for two terms but I hope that the American people see through him – the people around him just seem nastier versions of what has gone before and I think that in that there are the seeds of his presidency’s destruction.
However, my taking heart in all this shows to me just how dark his arrival is.
As for the tax issue, as long as tax is reduced I do not think that business gives a damn to be honest. And the tax evasion/avoiding business will have a field day helping to make business and the rich make the most of the ensuing confusion.
I think they’ll think as you suggest until the world collapses around their lugholes
Then they’ll panic
The chaos will be a goldmine for banks and specialist advisers.
This is a feature, not a bug, and the lobbying will be extravagantly funded.
When you get a very complex situation developing it becomes vulnerable to a crash or at least a major rapid transformation. But what the actual trigger happening might be is very difficult to predict and might be something unexpected, not understood properly or the wrong man/people making the wrong decision at the wrong time. When Arnold Nesbitt went long on East India Stock when he should have gone short he triggered the big one of the 1770’s and we lost the American Colonies.
Trump’s term in office will be overtaken by events. He will not get to do very much of what he’d like to do.
None of us saw 9/11 coming. Perhaps San Andreas fault or an asteroid…
Which seminar was this?
I cannot disclose
Sorry, that’s just the way things are sometimes