As the end of the pandemic gets closer, M&A activity around the world is kicking into gear and is expected to surge even higher in the final quarters of 2021 and into 2022. The phase-out of government stimulus programmes could force a wave of restructurings for struggling companies that have held on so far, whilst thriving companies setting their sights on growth seem likely to rely on mergers and acquisitions (M&A) as their strategy of choice. With this in mind, Donal Thomas of our tax team introduces our 2021 Cross-Border M&A Tax publication, a useful source of information for any business considering cross-border M&A.

Where the taxation of M&A is concerned, both private equity and strategic buyers continue to face uncertainty and change from an array of forces. These include the rising popularity of warranty and indemnity (W&I) insurance, the negotiation of global principles for taxing digital activity and reallocating taxing rights between jurisdictions, and questions over when and how government emergency financial support programmes will wind down.

For most regions of the world, tax uncertainty and complexity will continue to be a prominent feature of the deal landscape. For example:

  • Tax reform remains high on the European Union’s agenda, in terms of both cooperation with the OECD and its own measures, such as the Anti-tax Avoidance Directives I and II. Environmental levies and decarbonisation initiatives are also becoming a significant factor in transactions involving players in the EU.
  • The new US administration is expected to make sweeping changes to tax policy, regulation and administration that could have profound implications for transactions markets in North America and globally.
  • Many jurisdictions in the Asia Pacific region have embarked on substantial tax reform initiatives, but these reforms look quite different from one jurisdiction to the next due to the diversity of the region’s economies and varying levels of sophistication in their tax legislation and administration.

To support your understanding of the current taxation regimes of cross-border mergers and acquisitions 2021, we have collated a broad range of individual country and jurisdiction reports.  

Get in touch

COVID-19 is challenging leaders like never before. To find out more about how KPMG perspectives and fresh thinking can help you focus on what’s next for your business or organisation, please contact Donal Thomas of our Tax team. We’d be delighted to hear from you.