3.7Company Tax Policy
SBM Offshore’s tax policy is summarized as follows:
- The Company aims to be a good corporate citizen in the countries where it operates by complying with the law and by contributing to countries’ progress and prosperity through employment, training and development, local spending, and through payment of the various taxes it is subject to, including wage tax, personal income tax, withholding tax, sales tax and other state and national taxes as appropriate.
- The Company aims to be tax-efficient in order to be cost-competitive, while fully complying with local and international tax laws.
- The Company operates in a global context, with competitors, clients, suppliers and a workforce based around the world. A typical Engineering, Procurement and Construction (’EPC’) project sees a hull construction or conversion in Asia, topsides construction in Asia or South America, engineering in Europe or Asia and large-scale procurement from dozens of companies in many countries across the globe. Depending on the particulars of the client contract, the phase may be followed by a lease-and-operate phase involving the country of operations but also support centers of the Company located around the world. In each of these countries, the Company complies with local regulations and pays direct and indirect taxes on local value-added, labor and profits and in some cases pays a revenue-based tax. To coordinate the international nature of its operations and its value flows and to consolidate its global activities, in 1969 the Company created Single Buoy Moorings Inc, which continues to perform this function today from its offices in Marly, Switzerland.
- Complies with the transfer-pricing guidelines.
- Supports the Directive 2 (ATAD 2), as well as the Directive implementing the minimum taxation (OECD Pillar 2) at EU level. The Company is required to file detailed reports and transfer-pricing documentation in accordance with Base Erosion and Profit Shifting’s ( ) action 13 as is now implemented in Dutch tax law. The disclosures contained in the country-by-country reporting (‘CbCR‘) have been prepared to meet the requirements and have been filed with the Dutch tax authorities for the year 2021. ’s commitment to enhance tax transparency and is committed to full compliance with applicable laws in countries where it operates. Consistent with this approach, the Company supports the initiatives on base erosion and profit shifting, including, but not limited to, Anti Tax Avoidance
- Makes use of the availability of international tax treaties to avoid double taxation.
- Does not use intellectual property as a means to shift profits, nor does it use digital sales. Furthermore, the Company does not apply aggressive intra-company financing structures such as hybrids. In 2022, the Company reported a current corporate income tax charge of US$86 million under (compared to US$60 million in 2021). Due to the large losses incurred, notably on the legacy projects, some tax-loss carry-forward positions still exist at the global contracting company, which are limiting the current tax payments in Switzerland and in jurisdictions of the Company’s locations.
- Endorsed the B Team Responsible Tax Principles in August 2021 and published the SBM Offshore Approach to Tax on its website. This explains the key principles applied to tax matters and the associated governance as well as describing the Company’s global tax footprint.
- Regarding the initiative to address the Tax Challenges Arising from the Digitalization of the Economy and its two-pillar solution aiming to reform the international tax system, the Company acknowledges that the implementation of Pillar 2 may have some impacts on its income tax charge. However, those effects will only be known once the has released the Implementation Framework associated to the Model Rules and that the EU has also released the final version of the directive implementing the Pillar 2 model rules.