Tax changes should be targeted to help recovery of Covid and boost fight against climate crisis in G20 countries, according to research from accounting bodies


New Joint ACCA, CA ANZ and IFAC Report Finds Declining Public Support for International Tax Collaboration Despite Recent Corporate Tax Agreement

Sep 22, 2021 | New York, NY | English

Tax incentives should be used to enable positive global outcomes, such as economic recovery from the pandemic and prevention of the climate crisis, according to a new joint report released today by the Association of Chartered Certified Accountants (ACCA), the Chartered Accountants of Australia and New Zealand (CA ANZ) and the International Federation of Accountants (IFAC).

A survey of 8,000 people in G20 countries and New Zealand found that two-thirds (66%) strongly supported the use of tax systems to help individuals and small businesses recover. effects of Covid-19.

The full report Public Confidence in Taxation: Investigating Public Confidence in G20 Tax Systems can be read here.

Respondents were also very supportive of similar tax breaks to support efforts to tackle ‘global megatrends’, such as tackling the climate crisis, and efforts to support retirement savings, with 66% saying that these would be appropriate incentives.

Perhaps surprisingly, the survey found that support had declined in 15 of the 20 countries for international collaboration in tax matters.

And this despite the fact that 2021 has seen historic advances in international tax cooperation, including the agreement of the G7 countries to apply a minimum rate of 15% of corporate tax.

The Public confidence in taxation This study, which was carried out in the first quarter of 2021, follows two previous reports on the subject in 2017 and 2019.

Other key findings included insight into whether taxpayers in different countries felt they were paying a “reasonable amount of tax”. Overall, most respondents were likely to agree that their tax rates were reasonable at all compensation levels.

However, less than one in four respondents in G20 countries said high income people pay a reasonable amount of tax in their country.

And while 33% thought local businesses were likely to pay a reasonable amount of tax, in seven countries multinational companies were seen as paying too little tax.

Despite this mistrust, 49% of people overall were in favor of using tax incentives to attract multinational companies. There has also been a drop from 44% to 39% in the number of people supporting demands to force multinational companies to publish detailed tax information, although the vast majority continue to support multinationals sharing all their information with authorities. local tax.

The survey also revealed different levels of trust in global tax authorities and actors in the tax system. Trust in government tax authorities is polarized, with 43% saying they have or a high level of trust in tax authorities, but 22% saying they are suspicious. Overall, confidence in government tax agencies has increased slightly.

Tax professionals (55%) have the highest level of trust, followed by tax professionals (50%). Despite a slight increase in the level of trust this time around, politicians remain the least trustworthy group, with only 22% net mistrust.

Accountants are also seen to contribute to the efficiency of tax systems by making them more efficient, effective and fair.

The survey also asked about the trust citizens of various countries place in their media and social networks on the issue of taxation. Social media was the least reliable source, over 40% suspicious, and mainstream media fared little better, scoring over 30% for mistrust.

Total trust in social media was highest in India and China, but lowest in New Zealand and France. These results are reflected in the traditional media, with India and China trusting their tax coverage the most and France showing the most mistrust. Russian media were also 54% suspicious.

“The relationship between taxpayers and governments, and between business, society and tax systems, will be fundamental to the shape of the economies that sustain us all, over the next several years,” said report author Jason Piper. , Head of Taxation for ACCA. “Public confidence is at the heart of tax morality, which is the tendency of individuals and businesses to pay their taxes voluntarily and without interference from the tax authorities. ”

Anecdotally, many respondents stressed the importance of financial education from an early age, so that people understand the purpose of tax.

“Along with the uncertainty of the pandemic, this year has also seen historic advances in international tax cooperation, with political agreements within the G7, G20 and the OECD Inclusive Framework which began shortly before. this series of reports, ”said Ainslie van Onselen, Managing Director. by CA ANZ. “Tax policies to help address challenges such as climate change and aging populations are no longer issues on the horizon, it’s here and now. Well-functioning tax systems and high levels of taxpayer confidence backed by a strong accounting profession to design, implement and navigate the tax implications are vital as we seek to shape a better future. ”

The correlations between social welfare and an efficient tax system and economic growth are clear. It doesn’t matter if there are cultural differences or differing opinions on who pays enough taxes or how the funds raised should be spent.

“As leaders of the global accounting profession, we are proud to see the high levels of trust in professional accountants,” said Kevin Dancey, Managing Director of IFAC. “It embodies the profession we know. At the same time, we understand that there is always more to be done to maintain and strengthen this confidence.”

About IFAC: The International Federation of Accountants (IFAC) is the global organization of the accountancy profession dedicated to serving the public interest by strengthening the profession and contributing to the development of strong international economies. Comprised of 180 members and associates in more than 130 countries and jurisdictions, IFAC represents more than 3 million accountants in public practice, education, government services, industry and commerce.

For four decades, IFAC has represented the global profession and supported the development, adoption and implementation of international standards that underpin the contributions of today’s global accountancy profession. IFAC has maintained a long-term approach to creating and strengthening a global accountancy profession that supports transparent, accountable and sustainable organizations, financial markets and economies. More information is here.

About ACCA: The ACCA is the Association of Chartered Chartered Accountants. We are a thriving global community of 233,000 members and 536,000 future members based at 178 countries and regions which uphold the highest professional and ethical values.

We believe that accounting is a fundamental profession of society that supports both the public and private sectors. That is why we are committed to developing a strong global accounting profession and the many benefits this brings to society and individuals.

Since 1904, being a force for the public good has been embedded in Our goal. And because we are a non-profit organization, we are building a sustainable global profession by reinvesting our surplus to provide value to members and grow the profession for the next generation.

Thanks to our ACCA certification, a world leader, we offer everyone, everywhere, the opportunity to live a rewarding career in the fields of accounting, finance and management. And through our respected research, we lead the profession in answering today’s questions and preparing for tomorrow.

ACCA and CA ANZ have formed a Strategic alliance for the benefit of the membership and to help shape the future of the profession. Learn more about us on accaglobal.com

About CA ANZ:

Chartered Accountants Australia and New Zealand represents more than 128,000 financial professionals, helping them make a difference for the businesses, organizations and communities in which they work and live. We promote the CA designation and high ethical standards, provide world-class service and continuing education to members, and advocate for the public good. www.charteredaccountantsanz.com

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