From pricing and reputational risks to the threat of systems overload and cash flow disruption, indirect taxation is nothing like as easy as it seems. Almost everything that makes valueadded tax (VAT) and goods and services tax (GST) attractive to governments can make it a headache for businesses.
One of the main reasons why VAT/GST tend to be easier for tax authorities to apply and police is that a lot of the legwork and complexity are passed on to businesses. As the Grant Thornton global International Indirect tax guide1 of over 120 countries highlights, dealing with GST or VAT and their knock-on impacts can therefore be a significant challenge.
