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The global economic environment is characterized by continuous improvements in technology, an urgency to adopt and implement best practices and processes, and the potential for legislative change. Assessing a multinational's global business model is no longer an optional exercise. Business model optimization (BMO) is the process of understanding the demands of operations and of tax law and integrating them into the business model. Deloitte provides high quality, customized tax and BMO services that focus on helping multinationals integrate operational and tax requirements in a scalable and sustainable way in order to help business leaders to make effective decisions on an after-tax basis.

Deloitte delivers business model optimization services using the BMO Insight methodology, a set of experience based approaches to developing solutions to a range of tax issues and opportunities.

The challenge

The alignment of a multinational company’s operating model and its global tax objectives is an important step in enhancing corporate profitability and shareholder value.

Business leaders often have to make tough choices when faced with competing priorities such as competitive pressure in the market and the internal desire for growth, regulatory constraints, and increased public scrutiny.

Currently these challenges are compounded by the uncertainty of a changing landscape. This is partially the result of the OECD’s Base Erosion Profit Shift (BEPS) project which is expected to bring widespread regulatory and treaty changes across many jurisdictions.

Increased public transparency and new compliance obligations will present fundamentally new challenges for multinationals operating across multiple jurisdictions.

The solution

Business Model Optimization (BMO) is the process of integrating the operating model and global tax structures into the way a business operates. BMO is all about creating value through business transformation.

Even if your business has undertaken a BMO project in the past, now is the time to re-evaluate your strategy and choices to confirm you will have a sustainable model, that still makes sense in the new reset tax world.

Developing a tax model that is not based on operations runs the risk of curtailing the bottom line. And a business model that does not take tax into account may end up surrendering some or all of the profit it creates.

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