Simpler taxation, longer procedures

The World Bank Group and PwC’s Paying Taxes 2017 report – which studies how simple tax payment is 190 countries of the world – reveals that from year to year, it is getting simpler for businesses to comply with tax regulations, but the procedures of preparing and submitting the VAT and corporate tax declarations is becoming longer and more complex. According to the Doing Business methodology, the average tax rate is 40.6 percent of the profit. In 2015 no less than 162 counties had a VAT system and companies in 93 countries could claim a VAT refund. Such claims take 14 hours to prepare on average and companies need to wait for the refund for 5 months.

Businesses had to pay a corporate tax in 180 countries. Self-inspection of the corporate tax declaration is likely to entail an inspection by the tax authorities in 74 countries. The average company spends 17 hours with correcting the mistakes made in the declaration, while the tax-authority inspection takes more than 17 weeks. Andrew Packman, the head of PwC’s Tax Transparency and Total Tax Contribution group told: the Paying Taxes study revealed that in many countries governments contribute to a better economic performance by simplifying the tax system.