Tax compliance in Venezuela now the most difficult in the world
Alfredo Hurtado, partner in Russell Bedford Venezuela, comments on World Bank Paying Taxes survey
- (1888PressRelease) December 06, 2011 - Venezuela has become the most difficult country in the world for companies to meet their tax compliance obligations, slipping to bottom place in a major World Bank report.
The annual World Bank Doing Business report assesses regulations affecting domestic firms in 183 economies, ranking each on the basis of various criteria including ease of starting a business, insolvency resolution, cross-border trade and the ease (or otherwise) of paying taxes. Russell Bedford member firms have contributed to the report's Paying Taxes survey since 2009, with 51 member and correspondent firms this year contributing data on tax regulation, compliance and the real tax burden on businesses and entrepreneurs.
This year's Paying Taxes survey indicates businesses in Venezuela spend an average of 864 hours (108 working days) in meeting their tax compliance obligations, with businesses making no fewer than 70 separate payments each year.
While this year's report, Doing Business 2012: Doing Business in a More Transparent World, suggests the total tax take in most countries worldwide continues to decrease (from an average 47.8% in 2010 to 44.8% this year), Venezuela is one of few countries to have bucked this trend. According to the report: "In República Bolivariana de Venezuela … the nominal corporate income tax is based on a progressive scale of 6-34% of net income, but the total business tax bill, after taking into account deductions and exemptions, is 63.5% of commercial profit because of one other profit tax, four labour taxes and contributions, one sales tax, one property tax and three other taxes."
Alfredo Hurtado, managing partner of Russell Bedford Venezuela member firm Hurtado Esteban y Asociados commented: "The doubling of municipal sales tax earlier this year has undoubtedly contributed to the increased tax burden for small and medium sized businesses. More worryingly, the tax reforms proposed in late 2010 have yet to yield any real benefits for industry. We will continue to lobby for the very necessary reform of the tax administration system, as well as working with clients to mitigate its worst effects."
For further information, contact Alfredo Hurtado on +58 212 815 06 04 or Kempton Bedell-Harper on +44 20 7410 0339. Alternatively, visit the websites at www.russellbedford.com.ve and www.russellbedford.com .
About Russell Bedford International
Established in 1983, Russell Bedford International is a global network of independent firms of accountants, auditors, tax advisers and business consultants.
Ranked amongst the world's leading accounting and audit networks, Russell Bedford is represented by some 460 partners, 5000 staff and 200 offices in more than 80 countries in Europe, the Americas, the Middle East, Africa and Asia-Pacific.
All Russell Bedford affiliates are well-established firms offering international business advice and services to local and multinational clients. Most provide a full range of services comprising accounting, auditing, tax advice, general business guidance and financial consulting. In addition, many have special expertise in particular fields, such as international taxation or information technology.
In January 2008 Russell Bedford International was named one of the first 17 full members of the IFAC Forum of Firms after reporting it had implemented a globally coordinated quality assurance programme, committed to the use of International Standards on Auditing (ISAs), and met other specific ethics requirements.
Issued by:
Kempton Bedell-Harper
Marketing Director
Russell Bedford International
Russell Bedford House
250 City Road, London EC1V 2QQ
United Kingdom
T: +44 20 7410 0339
F: +44 20 7459 2337
E: info ( @ ) russellbedford dot com
W: www.russellbedford.com
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