Taxes

We strive to remain a fair and respected tax payer in the countries 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 all kind of taxes: in our case mainly income taxes and sales or value-added taxes. In complying with these laws, the Group also considers the spirit in which these laws are intended.

Roche is a fair and respected taxpayer. We acknowledge that taxation is essential to the functioning of society and legislation is part of national sovereignty. Over the past century the international community has found common ground in certain principles of taxation to facilitate international cooperation in business, in particular to avoid unfair double taxation. Further, it has been recognized that one of the basic principles for sustainable tax management is that taxes should be paid where economic value is generated. Roche’s structures and transactions which are documented in the Group’s business processes are based on economic substance and on the principle that taxes should be paid where economic value is generated. Roche’s structures are aligned with the business purpose and are not set up with the sole intention of avoiding taxes. Roche does not engage in artificial arrangements involving tax havens or secrecy jurisdictions.

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 particular cases Roche and the respective tax authority may disagree on the correct application of local tax law. In some cases there may be inconsistencies between tax authorities of different countries or even between national authorities within the same country as e.g. customs and tax laws are not always aligned and consistent. In the event of disputes, Roche contributes in a positive spirit to find balanced solutions in accordance with the applicable laws.

We are all expected to:
  • Comply with the tax laws in the countries where we operate.
  • Apply transfer pricing in accordance with OECD Transfer Pricing Guidelines for Multinational Enterprises and Tax Administrations.
  • Contribute actively and positively to solutions in the event of conflicts with local tax ­authorities or between national authorities.
Questions & Answers

How is Roche determining the transfer prices between group companies?

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, risks assumed, and assets employed as well as appropriate documentation.

I doubt that the actual or foreseen terms and conditions in an intercompany contract meet arm’s length standards as per OECD transfer pricing guidelines or local law. What shall I do?

Involve your contact person in Group Tax for further discussion.

What do I do if tax authorities question transfer prices on cross-border transactions?

Contact the responsible person in Group Tax to analyze the situation further and take appropriate action to comply with local laws and OECD transfer pricing guidelines, and in order to avoid double taxation.

Further Informations

Further information and guidance can be found on the Roche Internet and Intranet. For specific information consult the Roche’s Approach to Tax—General Description and Principles.