As Christian Aid has noted today:
The UK government is lagging behind business leaders in its support for corporate transparency, a new survey suggests. The survey, by PricewaterhouseCoopers, found evidence that most chief executives support reforms which would make it harder for multinationals to dodge tax in the UK and abroad - reforms which the UK government has consistently rejected.
Two-thirds (66 per cent) of the CEOs of large UK firms surveyed agreed that ‘multinationals should be required to publish the revenues, profits and taxes paid for each territory where they operate'.
PwC's research, which involved 1,344 interviews with CEOs in 68 countries, also found that across all the CEOs surveyed, 59 per cent supported the requirement.
That's an amazing claim, so I went to look at the data that PWC has published. It looks like this:
What really struck me with regard to country-by-country reporting - to which the first question relates and about which I should declare my personal interest as its creator - is not just that almost 60% agree that it should happen, but that the strong disagreement is so small. That is very powerful indeed.
As worryingly, it is the OECD that has been tasked with delivery of country-by-country reporting at present, and it seems that most of the business community share my doubts about its ability to deliver anything very meaningful on tax reform. That's troubling.
But for now I'll welcome the warmest endorsement yet for country-by-country reporting as a very firm step in the right direction.
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Am I missing something here? If all the ceo’s want it, why don’t they just report it, why do they have to wait to be forced to do it?
They call it a level playing field
But the signs are a new one can be created
This survey result doesn’t really surprise me, as boards increasingly want to be seen to be more transparent. There’s a bit of me that is not 100% sure this isn’t just spin though and something easy to say when they think/know that the level of reporting might in fact be quite light, but prepared to give them the benefit of the doubt for now.
It would be interesting to see a geographic breakdown of the assenters and dissenters. My guess is the dissenters are mostly our American cousins – But I may be being unfair on them.
As an aside, it was suggested to me from someone in the big 4 that there is a feeling that the OECD is really missing an opportunity with the whole BEPs scenario to seriously look at the whole international tax system and to really consider different methods of profit allocation. Said person wasn’t necessarily in favour of unitary tax/profit split or destination based tax, but it was clear they thought the OECD was not forward thinking enough and this maybe wasn’t just their personal view but a wider view.
Another interesting comment they made suggested they thought it wasn’t the OECD themselves dragging their heels, but the tax authorities who were against any such wholesale review.
The review would show which countries are getting the most tax revenue. This could cause companies to move out assets if its deemed too expensive to do business there.
It could, but most companies (certainly all the big ones who will have internal tax departments) are already aware of their tax costs in each country so CBCR will only tell them what they already know.
What CBCR would/should do is share that information with eeveryone external to the company.
It would also make job interviews for people like me when looking for jobs in tax departments much more interesting and more focussed (lol).
Having seen the note about this at the start of Davos week, reported in the Daily Telegraph. I am fully aware of the country reporting element. I was trying to find the link, however failed and am pleased you found it.
However, I would like to draw the attention to another line in questions, or responses from CEO’s. There is more of a demand for competitive tax regimes. Echoing other comments from companies about where they base their companies. Another example is Yahoo and where its Europe companies are moving to.