Growing web of tax tangles

Written by Saikat Neogi | Updated: Jun 5 2013, 02:29am hrs
A KPMG survey, done in the backdrop of lingering economic uncertainty increasing pressure on companies to cut costs and tax authorities to boost revenue, has found that the synergy between the management and tax department in handling the challenges has improved significantly.

Virtually, all India-based respondents report having a tax strategy that is consistent with their overall business strategy. Since 2009, survey results show that upper management and directors have started taking more interest in and responsibility for tax matters86% of respondents in India say their board has approved the tax department strategy, compared to 63% in 2009, and 90% respondents say their board or upper management was directly involved in guiding the strategys development. The survey has also found that tax audit and controversy activity in India have increased markedly since 2009. Currently, 86% of respondents in India say they are involved in some form of tax controversy. In many taxation areas, tax dispute levels are much higher than they are globally, which is probably forcing the company managements to take added interest in tax matters.