With tax transparency and reporting being among the hottest issues in tax today and the government now issuing a consultation including a proposal to introduce a legislative requirement that large businesses must publish their tax strategy as it relates to or affects UK taxation, the document summarises a number of common themes which arose in the course of discussions with UK multi-nationals which might form a platform or framework for disclosing tax information.
The direction of travel in respect of tax transparency is clear – there will be increased disclosure requirements with more information becoming public. But with several different reporting regimes existing side by side and various stakeholder groups looking for varying forms of disclosure, there is a real challenge for companies in how they manage this.
KPMG in the UK’s view is that British companies should engage in an open and constructive debate on tax transparency to establish what content can, and might, be usefully produced to meet the demands of the different stakeholder groups while balancing the cost to business. However, a prescriptive ‘one size fits all approach’ is not the right way to proceed with transparency.
The framework we have developed does not attempt to answer all of the questions an organisation may have, nor does it put forward a definitive template for disclosing tax information. What it aims to do is to prompt companies to evaluate where they are now in the overall tax transparency debate and to consider how they might approach this area in the future.