Indirect taxes in Asia
First published in Bloomberg BNA, July 2014
Drawing from the experience of European countries, the introduction of an integrated VAT/GST system in Asian jurisdictions could be a major breakthrough towards a comprehensive indirect tax reform across the region, with India and China set to pave the way.
With many Asian countries such as India and China on the verge of facing the daunting introduction of an integrated Value Added Tax/Goods and Services Tax system in the near future, it would be advantageous to draw on the lessons learnt from European jurisdictions when the European VAT regime was introduced. Particularly, it is worthwhile recalling the erstwhile sales tax systems andthe benefits of shifting to a GST system in Europe.
This is an exciting challenge for tax authorities, businesses and advisors. The impact goes far beyond tax – it also concerns the question of determining the new price of products and services, and after migration to VAT/GST, the sharing of the gains linked to this migration with the clients or the financing of the costs if no gain exists. Finally, monitoring VAT/GST requires proper IT/ERP tools and specific attention should be given to the IT departments in this process.
Your media contact for further queries is:
Barnaby Fry, MHP
T. +44 (0)203 128 8215
Quality tax advice, globally