E&Y writes about Unilever’s indirect tax management in the upcoming edition of E&Y’s T Magazine, and interviews Rishi Gainda, Director Global Indirect Taxation.
At Unilever, with 171,000 staff and turnover of €46b (US$60 billion) derived from sales in more than 190 countries, the scale of the challenge is considerable. In 2009, an internal survey revealed an indirect tax throughput of €12b-13bn (US$ 16-18 billion).
In other words, the indirect tax throughput is almost 40% of Unilever’s turnover.
Other notable quotes:
There is little reward for efficient tax collection, but stiff penalties for failure. Compliance with indirect tax regimes is critical because taxpayers falling foul of them can incur a penalty, as well as suffer retrospective tax assessments and a loss of reputation.
(…) indirect tax teams can do considerably more than manage indirect tax risks and VAT compliance. As well as optimizing cash flow, which helps the company’s funding needs, indirect tax specialists can help develop or further strategic aims.
Unilever is currently working on a project to review its indirect tax compliance processes and build an indirect tax control framework. The framework outlines the processes, including indirect tax risks and controls, and shares information about how indirect taxes can be managed effectively.
In addition to indirect tax compliance processes, there is a link to other business processes that are impacted by indirect tax. “The framework will also address how the indirect tax function should get involved in business change and how it adds value to the business as a whole,” says Gainda.