GRI 207: Tax 2019
Contains disclosures for organizations to report information about their tax-related impacts, and how they manage these impacts. The disclosures enable an organization to provide information on how it manages tax and information about its revenue, tax, and business activities on a country-by-country basis.
The Standard is structured as follows:
Section 1 contains three disclosures, which provide information about how the organization manages its tax-related impacts.
Section 2 contains one disclosure, which provides information about the organization’s tax-related impacts.
The Glossary contains defined terms with a specific meaning when used in the GRI Standards. The terms are underlined in the text of the GRI Standards and linked to the definitions.
The Bibliography lists authoritative intergovernmental instruments and additional references used in developing this Standard.
The rest of the Introduction section provides a background on the topic, an overview of the system of GRI Standards, and further information on using this Standard.
Background on the topic
This Standard addresses the topic of tax. Taxes are important sources of government revenue and are central to the fiscal policy and macroeconomic stability of countries. They are acknowledged by the United Nations to play a vital role in achieving the Sustainable Development Goals. They are also a key mechanism by which organizations contribute to the economies of the countries in which they operate. Taxes paid by an organization reflect that profitability depends on many factors external to the organization, including access to workers, markets, public infrastructure and services, natural resources, and public administration. Organizations have an obligation to comply with tax legislation and a responsibility to their stakeholders to meet expectations of good tax practices. If organizations seek to minimize their tax obligation in a jurisdiction, they might deprive the government of revenue. This could lead to reduced investment in public infrastructure and services, an increase in government debt, or a shifting of the tax obligation onto other taxpayers. Perceptions of tax avoidance by an organization could also undermine tax compliance more broadly, by driving other organizations to engage in aggressive tax planning based on the view that they might otherwise be at a competitive disadvantage. This can lead to increasing costs associated with tax regulation and enforcement. Public reporting on tax increases transparency and promotes trust and credibility in the tax practices of organizations and in the tax systems. It enables stakeholders to make informed judgments about an organization’s tax positions. Tax transparency also informs public debate and supports the development of socially desirable tax policies.
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