Wilson Cheng FCPA, Tax Leader, Hong Kong and Macau, and Greater China Tax Controversy Co-Leader at EY, on why tax controversies are not always a negative thing, and the important role he plays as a CPA during and after controversy cases
What are the three biggest lessons in your career so far?
The first is to look beyond the issue. There are many causes of business issues. Looking into them helps identify possible solutions in the interest of stakeholders. Secondly, when facing an issue, there can be a lot of different aspects to look into. Doing a proper consultation with experts and experienced partners allows me to gain additional knowledge and intelligence to approach an issue from multiple perspectives. Finally, building relationships is a critical element in the tax profession and also in the development of my career. In EY, I learned a framework for building relationships which is “Building relationships based on doing the right thing.” This is one of EY’s values and it guides us on how and what type of relationship we should build in our profession.
What do you like most about specializing in tax controversy?
In tax controversy cases, tax professionals play an extremely crucial intermediary role between the Inland Revenue Department and taxpayers. It is not only about resolving tax disputes through settlements or litigation, but also building mutual understanding between the two parties. We also advise taxpayers on upgrading their tax compliance to achieve tax efficiencies. Some of my clients have viewed the tax controversy they have encountered positively, and see it as a way to make improvements to business arrangements. Through post-controversy projects, we help them build a better organization. These long-term impacts are what I like most about specializing in tax controversy.
In what ways has your CPA qualification helped you in your career or work?
The training as a CPA allows me to analyse business issues critically and to provide forward-looking advice to my clients. The connection with other CPAs expands my knowledge as we work in different specialized areas. Through my qualification, I also have access to a platform that allows me to contribute to the profession and wider community using my professional knowledge.
In your view, what key changes are reshaping the Hong Kong tax landscape?
The development of the two main pillars of the Organization for Economic Co-operation and Development’s base erosion and profit shifting initiative has been broadly discussed in Hong Kong by the government, businesses as well as tax professionals. The impact to Hong Kong headquarters is significant and unprecedented. The low and simple tax regime in Hong Kong would need to be reconsidered in order to maintain Hong Kong’s competitiveness within Asia Pacific and globally. The European Union’s concern about Hong Kong’s offshore tax regime on passive income also changes the tax environment of Hong Kong and requires business substance to be set up in Hong Kong. Our reaction to these changes is imperative for the sustainable growth of Hong Kong’s economy.
What is your advice for those looking to specialize in tax?
Develop a broad business sense to communicate with clients effectively and to understand a client’s business before conducting technical tax analysis. Also, deep technical knowledge is the foundation in delivering our services and requires taking the time to learn and research. Lastly, develop a creative mind. Due to the development of new economy businesses and evolving tax legislations, tax problems are now more complex. Tax professionals need to be capable of challenging the current state and proposing new ways of addressing complicated tax problems.