Deloitte’s 2025 Asia Pacific Tax & Tariff Complexity Survey finds that 41% of business leaders would consider significant supply chain realignment even with cost increases below 20%, and another 42% capping their tolerance for tariff-related cost increase at 40% – a threshold far lower than expected.
This is Deloitte’s 5th study on the evolving complexity of the tax and business environment of the region. With the evolvement of the business landscape, this year’s study takes a sharper, more executive-focused lenses, capturing perspectives not only from tax leaders but also C-suite decision makers. The result is a concise view of what shapes business decisions today, and how tax and tariff considerations influence strategic decisions.
The survey, conducted between August 1 to September 21, 2025, received input from 363 senior executives from diversified industry backgrounds across the region.
Instead of relying heavily on price adjustments to absorb tariff shocks, executives now view them more as short term stopgaps rather than viable long term strategies. This shift in mindset reflects a broader recalibration: leaders are increasingly prepared to rethink their operating models when cost pressures intensify, signaling a more proactive and strategic approach to supply chain resilience.
Nearly 70% of respondents indicated that their primary focus in supply chain decisions has shifted from minimising costs to focusing on reliability, stability, or strategic alignment. This integrated approach has encountered several key internal obstacles beyond macroeconomic volatility. More than half of those surveyed cited operational challenges stem from internal gaps—insufficient processes, limited data capabilities, and critical skill shortages—making up 51% of the total. As a result, transforming the tax operating model has moved rapidly up the C-suite agenda. Operational readiness is no longer a baseline expectation, but a true competitive differentiator.
“For Thai businesses, the past year of US tariff swings has made certainty the scarcest commodity. Pricing tweaks buy time, but they’re the first reflex, not the final answer. The companies that will pull ahead are the ones turning tariff volatility into a reason to rebuild their supply chains for resilience, not just to pass on costs.” says Ms. Malika Bhumivarn, Tax & Legal Partner, Deloitte Thailand.
To help organisations navigate this complexity, Deloitte introduces the Strategic Response Compass. The compass orients decisions around three critical pillars: Cost Signals (pricing and cash flow sensitivity as catalysts for change), Alignment (supply chain and stakeholder ecosystems as connective strength), and Enablement (digital and operational readiness as engines of transformation). Agility and resilience remain essential, expressed most clearly through integrated scenario planning, and in this context, they materialise by orchestrating the dynamic interplay of the three pillars.
“Tax and tariff volatility has shifted from a background issue to a central factor for any business,” said Ms. Eunice Kuo, Deloitte Asia Pacific Tax & Legal Leader. “Treat cost signals as early warnings, align ecosystems beyond cost, and embed digital enablement at the core. Those that act on these imperatives will not only withstand shocks but will transform volatility into foresight, momentum, and lasting competitive advantage.”
Explore the full report for insights and recommendations to turn tax and tariff turbulence into strategic advantage: https://www.deloitte.com/southeast-asia/en/services/tax/perspectives/turning-tax-and-tariff-turbulence-into-strategic-advantage.html
