There is an increased emphasis on transparency and cooperation between governments. Extensive tax reforms are emerging from many countries, including the US Foreign Account Tax Compliance Act (FATCA), EU FATCA, EU Savings Directive and bilateral exchange of information.
Continuing regulatory and taxation reform, fiscal deficits, low growth, sovereign risk and globalisation are unlikely to be viewed merely as short to medium-term consequences of the financial crisis. The asset management industry is facing opportunities and challenges in the form of demographic shift, the rise in power and interconnectivity of the emerging markets, changing investor behaviours, technology and social media and state-directed approaches to economic development.
The study found that the majority of managers are adopting a reactive, ad hoc approach rather than a strategic controls-based approach to managing operational tax risks. This fragmented approach will increasingly become a problem for asset managers who will come under more operational and cost pressures as new financial transaction taxes emerge and tax information reporting regimes begin to take shape.
Link to full survey
© PricewaterhouseCoopers
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