A recently published survey of global tax functions by KPMG International has revealed that 93% of business leaders who participated consider that appropriate management of tax risks is either Important or Extremely Important as a performance metric for the tax function. The survey covered almost 200 leaders in charge of tax policy and operations of companies in all major sectors, with participants from 22 jurisdictions worldwide. Other metrics seen as particularly important were support by the tax function for corporate strategy (Important or Extremely important for 87% of respondents) and meeting tax compliance deadlines (viewed as Important or Extremely Important by 77%).
As René Schöb, Partner Head of Tax an Legal, KPMG in Romania comments: “The results reflect the concerns of business leaders in an uncertain economic climate to avoid exposure to unexpected tax demands, which can be seriously damaging to a company’s operations. An assessment by the tax authorities that the right tax has not been paid can generate not only a demand for the overdue tax itself, frequently with quite a short payment deadline, but also penalties and fines, which can often amount to more than the original tax due. In a worst case scenario, the company’s leadership can even face criminal charges for tax evasion. Moreover, If the business becomes involved in long disputes with the tax authorities, whether or not litigation takes place, this can take up time and resources, while considerable negative publicity can also be generated, with serious repercussions for the business’s reputation.”
Another notable message of the survey is that many business leaders are keen to use technology to reduce inefficiency and enhance the experience of staff in the tax function. A total of 84% of respondents said they were looking to “automate/improve processes to enhance the employee experience (i.e., eliminate manual tasks, minimize data manipulation, implement technology)”. As Daniel Pana, Tax Partner, KPMG in Romania adds: “Technology can play a key role in making tax administration easier and more accurate. It relieves staff of the burden of mundane tasks, enabling them to concentrate on activities which are more rewarding and bring more value to the business, such as assessing the impact of proposed legislation, or identifying tax facilities which the company might benefit from.”
KPMG in Romania’s tax professionals have considerable expertise and a proven track record in helping clients to manage tax risk. For example, we can carry out extensive Periodic Tax Reviews, which can identify areas of exposure to risk and offer recommendations on actions to be taken to mitigate it. Moreover, our Tax Return Certifications service adds value to the tax returns submitted, because it demonstrates to the authorities that they have been reviewed by a professional tax consultant, hence reducing the risk of an audit, which can be quite disruptive to the business. Full details of our services are set out in our brochures on Tax Reviews and Tax Return Certifications.
KPMG in Romania also offers a valuable technological tool; KPMG Corporate Tax Manager. This is developed 100% for the Romanian market, for the management and calculation of corporate income tax and generation of the required corporate income tax returns. It includes up to date, time-stamped algorithms and workflows – so that you reduce the risk of calculation errors. And these algorithms are updated promptly to keep pace with changes in the law.
