After taking other parts of the company global, Thomson Reuters' next plans involve taking its Tax & Accounting business global, CEO Tom Glocer said during the Webcast of an investor's conference this month. While he did not announce specific plans, such as additional details on the planned launch of the Global Tax Workstation, it was one of his most direct public statements about strategy for the tax and accounting operation.
Expansion is being driven by the internationalization of trade, with the Internet having a big impact, noted Glocer, while speaking at the Sanford C. Bernstein 26th Annual Strategic Decisions Conference. He also noted the problems faced by countries such as the United States that rely on income-tax income and not value-added tax revenue. He pointed to last year's acquisition of Sabrix as positioning Thomson Reuters for dealing with an developments in the U.S.
"Lots of jurisdictions are now looking at VAT. They have tapped out what they can do in terms of income tax. They need to find other ways to harvest other tax revenue," Glocer said. Although he noted VAT can be "quite regressive in how you implement it."
He said Sabrix, which handles sales-and-use tax rates issues,and similar applications from other compaies are important because tax complexity and electronic transactions that cross jurisdictional boundaries make these taxes far too complex for calculation outside of an automated system.
Glocer also said Thomson expects five years of no growth in Europe, very good growth in Asia, the Arabian Gulf and Latin America, particularly Brazil, and "perhaps a surprisingly strong recovery in the U.S."
