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Tax risk is weighing heavy on the minds of senior executives of corporate development teams, private equity firms and investment banks, according to a global pulse survey by Aon, a professional services firm with about 50,000 employees. The survey is included in the latest edition of Aon’s M&A Risk in Review report released on July 1.

About 80% of the 50 respondents said tax risk “is a more serious threat to deal success now than it was in the recent past,” according to the report. The greatest concerns identified include increased rates (34%) and the increase of anti-abuse rules (26%).

“Tax risk can be large,” says Gary Blitz, co-CEO of [mergers and acquisitions] M&A and transaction solutions practice at Aon. As businesses become increasingly more global, tax planning now crosses boarders and jurisdictions, Blitz says.

Changes to global taxation are on the horizon as 130 countries and jurisdictions are in favor of setting a minimum rate for corporations. The G20 is likely to sign off on the deal during a meeting July 9-10 in Venice, according to a Fortune report. Multinational companies would pay an effective rate of at least 15%. In the U.S., the Biden administration has supported the endeavor to prevent corporate profit-shifting.

Last year, 55 Fortune 500 companies paid no U.S. income tax. Large publicly traded companies file financial statements with the SEC and are also “required to use a completely different set of accounting rules for the IRS,” writes Geoff Colvin, Fortune senior-editor-at-large. “So, in any given year, a company can be profitable according to SEC accounting rules but not profitable according to IRS accounting rules—in which case it would pay no income tax.”

“Typically, when you’re either doing an M&A transaction or another type of financing, or just a company who’s doing tax planning, they make decisions based on advice they get from their tax professionals,” whether it be a lawyer or accountant, Blitz explains. The company usually doesn’t know if something is wrong with the filing until it hears from the IRS, he says. Tax insurance is a tangible solution to the uncertainty, Blitz says.

Concern and uncertainty over task risk will continue for some time, he says. “When there’s tax reform and tax legislation, there are new rules, and it takes many years for those rules to be explained in detail and understood,” Blitz says. “In addition, we’re in an environment now where the IRS, because of staffing issues and manpower issues, is limiting its willingness and ability to provide rulings, which is another way of gaining certainty. For example, one area where the availability of a ruling used to be routine is a corporate spinoff, and today that is no longer as [readily] available.”

But despite tax concerns, M&A is on the upswing. “During the onset of the pandemic, M&A screeched to a grinding halt,” Blitz says. “Since October and November, it has been busy, nonstop.”

Sheryl Estrada
sheryl.estrada@fortune.com

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