Executive Director addresses conference on high net worth individuals
A high level conference on tackling the challenges associated with taxation of high net worth individuals (HNWIs) was held in Vienna, Austria - convened by the WU Global Tax Policy Centre at the Institute for Austrian and International Tax Law (WU Vienna University of Economics and Business). CATA Executive Director Duncan Onduru, was among a host of international speakers who were invited to address over 100 delegates that attended the conference. In his remarks, Mr Onduru pointed out that the challenges posed by this category of taxpayers were similar to those posed by the multinational enterprises (MNEs) and therefore some common strategies may be applicable in both spheres. He noted that just like the MNEs, high net worth individuals operate in multi jurisdictions, have very complex wealth/asset management structures, employ the services of highly competent intermediaries, use mass marketed tax avoidance schemes and are likely participants and facilitators of illicit financial flows and money laundering activities.
Emphasising the importance of this taxpayer segment in contributing to revenue growth, Mr Onduru noted that the low ratio of personal income taxes to total tax revenue in Africa is a clear pointer that not enough attention has been directed at the HNWIs despite the existing potential. He urged the African countries to diversify their tax handling without putting heavy reliance on trade and other indirect taxes (which are very regressive in nature) and instead explore ways to raise the contribution of direct taxes just as developed countries have done. The conference is among a series of similar events organised by the university under the project ‘Tax and Good Governance’. It was co-sponsored by the UNODC, the World Bank, the African Tax Institute and the University of Pretoria.