Tax Governance Code

In February 2021, VNO-NCW announced in its agenda for 2030 ‘Ondernemen voor brede welvaart’ that the business community would develop a Tax Governance Code. This Tax Governance Code should lead to more transparency on the tax position of Dutch listed companies and could, in future, be incorporated into the Corporate Governance Code.
Taxes are a vital source of revenue for countries around the world and help to fund essential services like education, healthcare and transport. Today, it is more important than ever that companies are open about their tax payments, so that people can understand how much is paid and why. Transparency builds trust. It is about putting the numbers into context, but also about demonstrating the commitment to comply with legislation and explaining a company’s approach to tax. There are many initiatives to help to increase transparency and public understanding of a company’s tax position, such as the B-Team Responsible Tax Principles, the Global Reporting Initiative and the World Economic Forum Stakeholder Capitalism metrics. Taxes are also a key metric for ESG. All these initiatives have been a source of inspiration and have provided building blocks for the Tax Governance Code published below. The intention has been to align the Code as much as possible with existing standards and disclosures with the aim of amplifying the rigorous work already done by standard?setters rather than reinventing the wheel. For example, the consideration that taxes paid by companies are not a cost factor only and also the commitment to comply with the letter, the intent and the spirit of the tax legislation. The Tax Governance Code is concise and based on the ‘comply or explain’ principle. The Code aims at a broad commitment of companies to endorse the ambitions expressed in this Code and to comply with it in its entirety. Although in first instance written for Dutch listed companies, we also encourage non-listed companies to endorse the Code. If a principle or provision is not yet complied with, the company explains what it will do to meet the principles in a reasonable timeframe. VNO-NCW strongly believes that this Tax Governance Code will help to build trust and will serve as a meaningful answer to the public call to companies for more transparency and accountability on their tax position. It should also enable stakeholders to gain a better insight and understanding of companies’ compliance with national and international tax rules. To meet the ambitions in this Code, companies will have to make a serious effort.
The intention is to update the Tax Governance Code from time to time in line with relevant developments