Tax matters should be treated as an integral part of the business and the same principles as for other parts of the business should be applied. Accordingly, tax is included in Sandvik’s Code of Conduct as of 2015.
The Group has a tax policy which has been adopted by the Board of Directors. The purpose of this policy is to ensure that Sandvik’s organization has a clear governance framework around taxes. We always strive to act as a good corporate citizen and all tax activities must be carried out in compliance with applicable laws and regulations in order to protect shareholder value, including Sandvik’s reputation and brand.
The tax policy is mandatory for all Sandvik entities and employees and it defines principles for issues such as tax compliance and reporting, tax risk management and transfer pricing.
The OECD has issued guidelines for transfer pricing of cross-border transactions in multinational groups. Sandvik adheres to these guidelines but also to the local legislation of each country to ensure that a correct pricing model is deployed and that a correct amount of tax is paid in each country.
Transparency and cooperation
Sandvik strives to have transparent relations with our stakeholders, such as tax authorities, non-governmental organizations and investors. We have initiated cooperation with tax authorities in several countries through which we share and discuss the company's internal efforts to ensure that we have systems and procedures in place to reduce tax risks while complying with tax laws. This approach is voluntary and based on transparency and trust between the company and relevant tax authorities.
We are convinced that an open discussion and cooperation with tax authorities around the globe will help us to reduce uncertainty about the taxes we are obliged to pay. Sandvik also endeavors to sign agreements with tax authorities, advance pricing agreements or rulings, to obtain certainty regarding the pricing model for certain transactions.