Tax World Vision 2021: EMEA
Oleg Rak, managing partner of Mason Rak, explains how firms from Europe and the Middle East can get ahead of 2021’s tax challenges through tailored, strategic recruitment.
Tax leaders across the EMEA market are looking to 2021 as they consider the challenges and opportunities that the post-pandemic tax landscape presents. Countries across the region face their own unique obstacles, but dynamic accountancy and law firms have the ability to turn this unprecedented time into a business opportunity.
EMEA’s new challenges and opportunities
In Europe, as the UK leaves the EU, its digital services tax (DST) comes into force, bringing with it a set of implications for both established digital firms, as well as multinationals looking to transition towards a more digitised, consumer-facing business model. France, Italy and the UK are among the European countries who have implemented a DST. On the other side, Switzerland, the Netherlands and Ireland have expressed strong reservations by recommending a more global than European solution to taxing digital activities.
Meanwhile, in the Middle East, the transfer pricing (TP) landscape is changing rapidly. Tax directors told ITR that the cost of TP compliance has increased in the Gulf States, with countries introducing TP regimes to meet the OECD’s BEPS standards. The introduction of VAT regimes in jurisdictions such as Oman, Bahrain, and Saudi Arabia have also shown the need for strategic thinking about how to address a rapidly changing indirect tax landscape.
Though the year ahead looks daunting for tax professionals and professional services firms in EMEA, the reality is that this is a time for individuals and firms to think strategically and to restructure and reorganise. Regions across the Middle East, such as Oman and the Gulf States, must handle the introduction of VAT regimes, so there is a great need for firms across the Middle East to find brilliant indirect tax talent from more advanced jurisdictions. Similarly, in Europe, firms will need to have the best tax expertise on hand as they confront issues surrounding DST and deal with the wider implications of Brexit.
Strategic growth: From Luxembourg to Dubai
Forward-thinking firms across EMEA understand the importance of strategic growth through the acquisition of tax talent in 2021.
The perfect fit for Luxembourg
For example, the Luxembourg hub of a global law firm recently retained Mason Rak to identify a seasoned TP partner to drive business growth. Mason Rak’s network played a significant role in this particular assignment. Long-standing relationships across the European market meant that the selection could be made from a small pool of high-calibre tax professionals, with strong local knowledge of the Luxembourgish market.
European clients have become more exacting in their onboarding specifications. There is increasingly a much greater focus on language capabilities, as firms place more emphasis on individuals fitting the culture of the specific firm and integrating into society. The team had to find someone with proven hands-on experience, a portfolio of local clients, and French language skills.
Mason Rak’s research team proactively targeted suitable individuals, and provided the client with high-calibre candidates as the search evolved. Through managing the entire search process – from selection to successful appointment – the team could ensure both parties were on the same page, and thus satisfied with the final outcome. As the client used their initiative and saw the value in acquiring dynamic tax talent, their business is growing and their reputation within this practice area continues to transform.
Other recently completed TP assignments for firms looking to increase their market share in Europe include a team acquisition in Zurich, and partner appointments in the Netherlands and the UK.
Transforming tax leadership in the Middle East
Meanwhile in Dubai, a global professional services firm sought to transform its tax practice and increase its presence across the Middle East. It is typical for firms based in the Middle East to look for tax talent from more advanced jurisdictions. This assignment was no exception, and the search was focussed on the expat market. Fortunately, the Middle East is one of the most exciting jurisdictions in terms of new opportunities and there are significant financial upsides and lifestyle benefits for tax professionals who are willing to move to the region.
Chosen tax professionals therefore had solid understanding of the local market, and an understanding of Middle Eastern culture. Career progress for expats in the Middle East is much faster than in more advanced tax jurisdictions. The selected candidate was an ambitious, entrepreneurial tax professional, and over the following months, Mason Rak helped the client to build an entire world-class tax team. By thinking ahead and securing top tax experts, the firm is prepared to tackle the region’s evolving legislations.
In both cases, it is clear to see that strategic growth of market share through the acquisition of tax talent is possible and profitable at this time. By utilising this period of change – not waiting to react, but acting decisively – firms have a significant opportunity to get ahead of the game.
Mason Rak is a global specialist tax search firm, who operate extensively across all key global markets. The firm executes some of the most challenging strategic tax search assignments and acts as a trusted advisor to accountancy and law firms around the world. If you would like to learn more about the global market and strategic leadership opportunities, please contact the author.
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