Indirect Tax

Indirect taxes, ranging from VAT and customs duties to environmental levies, affect the supply chain and the financial system. They pose unique challenges to multi-national tax functions, since they must be managed accurately and in real time. These often invisible taxes can have significant impacts — on cash flow, absolute costs and risk exposures.

Thanks to our network of dedicated indirect tax professionals, who share knowledge and ideas, we can provide a seamless, consistent service throughout the world and deal effectively with cross-border issues. These include advising on the VAT treatment of new and complex transactions and supplies and helping resolve classification or other disputes and issues with the authorities.

We provide assistance in identifying risk areas and sustainable planning opportunities for indirect taxes throughout the tax life cycle. We provide you with effective processes to help improve your day-to-day reporting for indirect tax, reducing attribution errors, reducing costs and ensuring indirect taxes are handled correctly.

We can support full or partial VAT compliance outsourcing, identify the right partial exemption method and review accounting systems. Our customs and international trade team help you manage customs declarations, audit and review product classifications and evaluate import/export documentation. Our globally integrated teams give you the perspective and support you need to manage indirect taxes effectively. It’s how Ernst & Young makes a difference.

Indirect Tax reporting in the new environment

This survey finds that the environment for indirect taxation (pdf, 115kb) has become increasingly complex over the past five years. Companies find themselves having to invest more and more in tracking and accounting correctly for Value Added Tax (VAT) or Goods and Services Tax (GST), with a growing recognition that far from being a ‘workthrough’ tax for business, the error rate in VAT/GST imposes high costs in management time and reduces cash flow, which impacts on shareholder value.

The growing burden? The impact of VAT/GST around the world

Indirect tax is often the forgotten tax on business. A new report from Ernst & Young analyzes indirect tax rates and trends (pdf, 314kb) in more than 60 countries, revealing a surprising tolerance of failures to track, fully report and legitimately reclaim indirect taxes.

Addressing global customs risk

Risk management has emerged among global traders as a primary objective of the corporate import function. A symposium hosted by Ernst & Young US brought together senior executives from wide-ranging industries to explore current trends in corporate risk management of the import function. The leading practices are summarized by our US firm in "Global customs risk management" (pdf, 511kb).