Tax transparency: communicating the tax companies pay

 

We continue to see a trend towards greater tax transparency as businesses recognise the value of talking more openly about the taxes they pay. In our latest report we share our insights and how companies leading in tax reporting talk about tax in a way that is easy to understand for non-tax experts. This may provide a useful tool for you when you’re thinking about your tax communications.

 

Companies are talking more about tax

 

Companies are talking more about tax contributions than when we started our review six years ago. But there's still a clear group of leaders who are talking more about tax and covering different aspects of their tax affairs.

  • Almost half of these companies (48%) include some discussion about how they approach tax and 36% discuss their relationship with the tax authorities.
  • More companies are talking about the governance and oversight for tax than last year with 58% of the companies we reviewed covering this.
  • 32% show an adjusted tax rate as well as the effective tax rate.
  • 34% provide an indication of future accounting effective tax rates, and 22% talk about cash corporation tax payments.
  • 18% talk about how taxes are part of the economic value they add to society and 22% use a total tax contribution approach showing the different taxes borne and collected.
  • 26% discuss tax in a separate sustainability or corporate responsibility report as well as the annual report.