Strategizing International Tax Best Practices – by Keith Brockman

Tax transparency is experiencing a dramatic upsurge in interest by various stakeholders. The year 2024 is looking to be exciting, with OECD’s Pillar 1 & 2 proposals and EU’s CbC directive to be possibly effective. Most recently, shareholders of Amazon put forth a proposal inviting additional tax transparency into its global tax practices, via implementing (some or all) parts of GRI 207.

Click to access gri-207-tax-standard-2019-factsheet.pdf

The above link provides a primer/reference into the workings of this transparency initiative, which is divided into 4 parts. The Standard was developed by an expert multi-stakeholder technical committee under the oversight of the Global Sustainability Standards Board (GSSB) with input from over 250 stakeholders from multiple constituencies.

207-1: This information provides a publicly available tax strategy, outlining responsible personnel, compliance approach and integration into business operations/strategies.

207-2: The second part addresses tax compliance and risk roles/mitigation and (again) how tax is placed within the Company.

207-3: Part 3 is focused on engagement of stakeholders, including public tax policy advocacy, tax authority interaction and feedback processes.

207-4: This final part includes Country-by-County (CbC) reporting, for all jurisdictions.

Notwithstanding the link of some/all information as a public document, I highly recommend all multinationals have the first 3 parts formalized for review./approval by the Audit Committee/Board of Directors.

This document represents a win-win proposal and may also serve as an impetus to formalize Best Practices such responding to governmental consultations, integration with OECD principles, interactions with auditors, delineating the difference in tax planning vs. tax evasion, etc.

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