| CENTRAL Asia
and Eastern Europe have been the biggest tax reformers over the last nine years,
according to Paying Taxes 2014 report jointly prepared by the World Bank Group
and PwC.
The
Report says: "Economies in this region have shown the largest fall in both
the time to company (220 hours) and number of payments (25.1 payments) and apart
from the Middle East have the largest fall in the total tax rate (15.7
percentage points)."
The
Report, released on 19 th November, notes that the Middle East has the least
demanding tax system – the sub-indicators have all remained stable through the
study period (June 2012 to June 2013).
It is
no wonder then that the top three slots in overall global ranking of paying
taxes report have been occupied by the countries from this region. United Arab
Emirates is thus perched on the top of the overall rankings for 189 economies
covered by the study. The 2 nd and 3rd rank have been taken by Qatar and Saudi
Arabia respectively.
The
lowest rank of 189th has gone to Chad, which was preceded by Central African
Republic. The third rank (187 th ) from the bottom has gone to Venezuela.
The
Report says: "On average it takes our case study company 268 hours to comply
with its taxes, it makes 26.7 payments and has an average total tax rate (TTR)
of 42.1%."
TTR
measures the amount of taxes and mandatory contributions borne by the standard
company (as a percentage of the commercial profit or the profit before all of
those taxes). The lowest TTR is found in Macedonia and the highest is in the
Gambia.
The
time sub-indicator captures the number of hours it takes to prepare, file and
pay the three major type of taxes: profit taxes, consumption taxes and labour
taxes & mandatory contributions. The time to comply by case study company is
lowest (12 hours) in UAE and highest (2600 hours) in Brazil.
The
number of payments measures the frequency with which the company has to file and
pay different types of taxes and contributions. The number of payments ranges
from the lowest 3 in Hong Kong to highest 71 in Venezuela.
A
World Bank release says that Report found that 32 economies continued to take
steps during the period from June 2012 through June 2013 to make it easier to
pay taxes. The study of tax regimes in 189 economies found that for the third
consecutive year the most common tax reform was the introduction or improvement
of online filing and paymentsystems for tax compliance. The compliance burden
(the time to comply with tax obligations and the number of payments) has
continued to fall in 2012, but the rate of decline has slowed.
The
Paying Taxes annual report builds on the World Bank Group's Doing Business
reports' chapter on Paying Taxes.
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