We are committed to complying with the tax laws in any country where we operate
Roche operates around the globe and it is our obligation to comply with the tax requirements in any country where we operate. This includes tax obligations for all kind of taxes: in the case of Roche mainly income taxes and sales or value-added taxes.
Income taxes are payable based on taxable income. The taxable income of a group company depends substantially on transfer prices for goods and services bought from or sold to other group companies. Tax authorities may claim higher taxable income by asking for lower transfer prices on purchases and/or higher transfer prices on sales. As a consequence, higher taxable income may result for one party involved in the transaction. If the tax authority of the other country involved in the transaction does not adjust income correspondingly, income adjustments of the first country lead to double taxation for Roche.
In order to avoid or at least reduce the probability of double taxation, Roche companies apply the “OECD Transfer Pricing Guidelines for Multinational Enterprises and Tax Administrations” for cross-border transactions of goods and services. This includes the application of the correct transfer pricing method based on the analysis of the functions performed and risks assumed as well as appropriate documentation.
In particular cases Roche and the respective tax authority may disagree on the correct application of local tax law and the OECD transfer pricing guidelines. Furthermore, the national tax authority of one country could have a different opinion from a national tax authority of another country with regard to transfer prices applied. In some cases there may even be inconsistencies between national authorities within the same country as e.g. customs and tax laws are not always aligned and consistent. However, Roche is committed to complying with tax laws. In the event of disputes, it contributes with the respective authorities in a positive spirit to find balanced solutions in accordance with the applicable laws.