The time to act is now
In recent years, we have observed continued efforts to expand the tax reporting requirements for individuals, multinationals and intermediaries. Not only that, but some places (including the UK, Australia and the EU) have already established public tax disclosure obligations for specific industries or companies of a particular size. Tax has also become an important part of the broader sustainability and corporate social responsibility discussion. This has resulted in a wave of tax-related studies and recommendations from non-governmental organisations (NGOs) and politicians trying to shed light on tax matters. Last but not least, institutional investors have started to show significant interest in companies' tax principles. Public tax transparency is about joining in the debate. If you want to do so, the time for action is now.
What is public tax transparency about?
Act now and set a good example, which may help shape the way potentially mandatory public tax disclosures are designed in the future.
Highlights from the paper
What's in it for me?
Taxation is the most important source of government revenue and as a result very important for society and its institutions. Being open and providing easily accessible information about your tax contribution may be a good way of building or rebuilding reputation and public trust.
What exactly is public tax transparency?
Public tax transparency is best described as presenting easily understandable information on the broader economic contributions a taxpayer makes by paying or collecting taxes in the environment in which they operate. It’s important for each company to think strategically about what exactly it wants to disclose.
Why should I deal with this issue right now?
If you act now, you might have the opportunity to make an impact on broader developments in public tax transparency, because it has clearly already gained momentum. Important investors are picking up on the topic, and initiatives like the UN-supported Principles for Responsible Investment (PRI) and the Global Reporting Initiative (GRI) are including public tax transparency in their frameworks. Industry-owned action groups like The B Team Responsible Tax Principles are also pushing the topic.
What should I do now?
Your very first step should be to decide how to respond to an increasingly transparent tax environment. The second step should be to adopt a position and start to develop a strategic response. Finding an approach to public tax transparency may be part of it.
