Predicting the unpredictable – The 2017 Financial Services Taxation Conference

2016 taught us to expect the unexpected.
Donald Trump was elected President, the Panama Papers were leaked, Brexit
actually happened, changing the GST did not… technology upped its disruption
ante, the OECD shone the spotlight on its BEPS project and the crackdown on
multinational tax avoidance got even more real. These events have changed the
face of the financial services industry and given the Australian corporate tax system
a shake-up. If 2017 is anything like the year gone by, we’re in for an
interesting ride.

Australia’s financial services
sector is the largest contributor to the national economy, contributing around
$140 billion to GDP over the last year. It has been a major driver of economic
growth and with 450,000 people employed in this sector, it will continue to be
a core sector of Australia’s economy into the future.*

Yet, as dominant and resilient
as the industry may be, it is in no way immune to global and domestic
pressures. Almost a decade ago, the Global Financial Crisis rocked the economy
and the industry has been rebuilding trust and confidence since. Now the
growing onslaught of the OECD’s Base Erosion and Profit Shifting (BEPS)
project, FinTech, blockchain and robotics threaten to disrupt the industry
again. For those practising in the industry, the key is to understand the
changing players, influencers, instruments and markets – and more importantly,
how they all impact the future of corporate tax in Australia. 2017’s
Financial Services Taxation Conference
will help practitioners do just that, and here
we take a look at some of the key sessions and speakers from this year’s event.

The current state of play

In a post-BEPS world,
international tax issues will only continue to crop up more and more. The sessions
at the conference will focus on hybrid mismatch arrangements, branch/permanent
establishment attribution issues, CFC rules, thin capitalisation, transfer
pricing and Division 6C – core topics that will change the financial services
industry and the way regulators operate.

There is already so much going
on in the financial services sector right now.

The OECD continues work on its
BEPS project, the Senate was due to issue its report on its Inquiry into
Corporate Tax Avoidance and a number of companies signed up to the Board of
Taxation’s Voluntary Tax Transparency Code. In addition, the 2016-17 Budget
proposed corporate tax cuts, the Government ruled out changing the GST and an
exposure draft for implementation of the Diverted Profits Tax (DPT) was released
to address multinational tax avoidance.

The Panama Papers leak, the Chevron transfer pricing case, the
introduction of the Multinational Anti-Avoidance Law (MAAL) and DPT have all
roused public interest in the taxation of multinationals. Last year’s election
campaign might have shied away from the topic altogether, but the Government
has since turned its plan to tackle tax avoidance up a few notches with the implementation
of the MAAL and DPT. More than ever, large corporates are under the microscope
with their tax activities.

In his session, Tony Cooper (EY) will compare and
contrast the MAAL and DPT, considering whether they apply and where they
intersect. The UK experience of its DPT will also be considered. From a
regulator’s point of view, Jonathan
Woodger (ATO)
will provide comments on the ATO’s guidance in relation to
MAAL and how it proposes to apply the two new regimes.

New laws, new flaws

Will new laws be effective in
combating tax avoidance? In the wake of these major changes, the financial
services industry is once again grappling with uncertainty, gaps in the law and
legislative reforms. In their keynote presentation, two speakers from different
perspectives – Michelle de Niese
(Corporate Tax Association)
and Professor
Miranda Stewart (Crawford School of Public Policy)
– will consider where
the Australian corporate tax system is heading, whether it needs reform, and
what that reform should look like.

This new world of transparency
extends also to the new common reporting standard (CRS) which commences on 1 July
2017. With only four months to go to implementation, Fred Law, CTA (NAB) and Anthony
Siouclis (ATO)
will discuss the effect of the 16 choices available to
Australian financial institutions, the impact of the US position on CRS and the
interactions between CRS, the Foreign Account Tax Compliance Act and Anti-Money

Speakers Steele Broderick, CTA (Treasury) and Natalie Raju (KPMG) will also delve into the proposed rewrite of
the Taxation of Financial Arrangements (TOFA) as announced in the Budget, and
provide insights around key legacy issues and the extent to which the proposed
reforms should address some of these issues.

The technology-enabled tax function

For many, technology was
initially regarded a disabler to the financial services and tax industries. The
rise of FinTech threatened the stability of its incumbents and rocked the
status quo. However, technology is now a major player in the corporate tax
system and has forced tax functions to adapt and respond to the digital era.

The tax function is certainly
evolving and broadening – and at exponential speed. What exactly are the key
trends and how do these apply to the financial services sector?

Kelum Kumarasinghe (EY) and Simon
Jenner, CTA (EY)
will shed light on the digital era and provide a summary
of the internal and external factors impacting the tax function. Their session
will also cover the current tax technology trends being seen in the market,
with a particular focus on data-driven tax audits, analytics, robotics, tax
portals and blockchain.

With so many emerging disruptors
and new laws affecting the financial services industry, it is no surprise that key
players, influencers, issues and perceptions have changed. This year’s sessions
have been developed to dig deeper into current issues as well as shed light on new
trends that will change the industry going into the future. 2017 is gearing up
to be an incredibly interesting year for financial services and tax!

Join us

Join us and all the high calibre speakers at The Tax
Institute’s Financial Services Taxation Conference 2017 to find out more, 8-10 February 2017
at the Palazzo Versace on the Gold Coast.


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