Hong Kong firms less eager for tax advice
Hong Kong companies are less eager for tax guidance and advice than their counterparts in the Asia-Pacific, according to a report from advisory firm Grant Thornton. Only 60 per cent of Hong Kong businesses would like to have more guidance from tax authorities, while in the Asia-Pacific 67 per cent of firms want to know more. That was in line with companies globally, where 68 per cent on average sought more tax guidance.
The international business report surveyed 3,194 firms in 44 economies about tax regime at their place of business in the first quarter. Fifty were Hong Kong companies.
William Chan, a tax partner at Grant Thornton Hong Kong, said the city's tax system was relatively simple and straightforward. As a result, firms in the city were less eager for guidance on tax.
Chan said most Hong Kong business leaders were still open to further guidance on cross-border tax planning, and called for more support to improve co-operation between governments and mitigate aggressive tax planning.
Hong Kong companies with overseas activities had the highest demand for tax advisory services, he said. "They want to know the ways to claim offshore exemptions in Hong Kong and the tax status in the overseas jurisdictions where they carried out or carried on business there."
Economies that give clear guidance on their tax policies and incentives may become more attractive to businesses looking to invest abroad.
Low transparency and inconsistencies could put businesses in difficult situations where they sought to minimise costs and maximise returns, Chan said.