LOCAL companies need to ensure their tax systems are ready for the global stage, says an international expert.
"In a perfect world, the tax laws would be aligned between each country... completely in sync," said Mr Dan Lange, the global managing director of tax and legal for consultancy Deloitte Touche Tohmatsu.
However, countries tend to have different tax systems and may choose policies unilaterally, he told The Straits Times yesterday.
This has led to a "heightened degree of concern over taxes" for firms with overseas operations, he said.
If one country decides to forbid firms from claiming tax deductions for certain interest expenses, for instance, their overall tax liabilities could go up, he added.
Mr Lange was speaking on the sidelines of a global tax conference held by Deloitte at the Ritz Carlton Millenia hotel. About 370 people attended.
Law Minister K.Shanmugam told the conference that a tax treaty with the United States could be on the cards but might not materialise soon. He was responding to a question from the floor during a dialogue.
He said Singapore companies have increasingly begun to invest overseas so it makes sense both ways. "We've talked about it with the Americans, we have arrangements and we've asked for them to be looked at, but I think it will take a little bit of time," said Mr Shanmugam, who is also Minister for Foreign Affairs.
The current political tumult in the US "is not going to be very conducive for double tax agreements" because there is "a feeling that their companies are moving offshore", he added.
Mr Shanmugam also spoke of his personal confidence in the Asean economy, describing it as "bullish".
"Connectivity is increasing... I expect this momentum will gather pace," he said, citing developments such as the future high-speed rail link between Malaysia and Singapore.
"As long as there is relative peace and stability... and there is some certainty to the rules and laws, I think the future is pretty bright."