Responsible tax policy

The Board of Directors of Repol, S.A approved its Tax Policy on November 25, 2015, and its Executive Committee ratified it on November 22, 2022.

People walking around the Repsol Campus courtyard

Our tax strategy is based on five fundamental principles

We are committed to managing our tax affairs applying good tax practices and acting transparently, paying taxes in a responsible and efficient manner, and promoting cooperative relationships with governments, striving to avoid significant risks and unnecessary disputes. 

  • Responsible compliance
  • Tax efficiency
  • Cooperative relationships
  • Prevention of tax risks
  • Transparency
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Aligned with the highest transparency standards

We voluntarily comply with the latest international standards on responsible tax policy, such as the GRI-207, and follow the B-Team Responsible Tax Principles.

Since the approval of the tax policy by the Board of Directors, many actions have been carried out which are directly based on the five principles in the Tax Policy and reflect the Group's compliance with them.
 

1. We are aware of our responsibility in the sustainable economic development of the societies in which we operate and that the taxes we pay represent a significant part of their economies.

For this reason, we are committed to the responsible payment of taxes in the countries in which we operate, applying the following action principles: 

  • We comply with the law, respecting both the letter and spirit of the law. 
  • We apply the “arms length” principle in our intra-group transactions.
  • We adopt our tax positions based on solid economic or business reasons or on commonly accepted practices, avoiding abusive tax planning schemes or practices.
  • We provide true, complete information on our transactions.
  • We prioritize non-litigious means of resolving conflicts when possible and the possibilities offered by legal procedures to strengthen agreements with administrations.
  • Some examples of our responsible compliance:

- Complying with the Spanish Code of Good Tax Practices.

- Non-use of special purpose vehicles in tax havens.

- Aligning transfer prices with value creation and the arm’s length principle.

- Regulations, internal control processes, and whistleblowing channel to ensure fiscal compliance.

- An adequate organizational structure and the means to comply with our tax obligations.

- Professional team undergoing continuous training, subject to a common remuneration policy with a contingency plan for key positions.

2. We reconcile responsible compliance with our tax obligations with the commitment to create value for our shareholders.

We do this through efficient management of tax payments and benefits, keeping in mind the Company's global interests and anticipating significant tax risks.

  • Some examples to demonstrate our tax efficiency and defense of the company’s interests:

- Tax planning aligned with the business and aimed at legitimate optimization.

- Corporate structure in line with the business and in line with legal requirements and corporate governance standards.

- Applying tax breaks in accordance to all economic players (deductions for research, development, and innovation; freedom to amortize; capitalization of reserves, etc.)

- Supporting publishing the tax incentives in oil contracts from authorities and governments.

3. We are committed to building relationships with tax authorities

These relationships are based on the principles of trust, good faith, professionalism, collaboration, loyalty, and a search for mutual understanding based on reciprocity to facilitate the application of the tax system, increase legal security, and reduce disputes.

  • Some examples of our cooperative relationships:

- Voluntarily presenting our Tax Transparency Reports to the Spanish Tax Agency since 2015.

- Participating in employment forums in cooperation with public administrations (Spain, Brazil, Canada, Portugal, Singapore, United Kingdom, the Netherlands).

- Voluntarily participating in the European Trust and Cooperation Approach ETACA program, continuing on the successful path initiated in the past with the OECD's “International Compliance Assurance Programme” (ICAP).

- Collaborating with international organizations (OECD, UN, and EU).

- Being certified as an Authorized Economic Operator in the EU and in Peru

4. We apply responsible tax policies that enable us to prevent conduct that could generate significant tax risks.

We frame the management of these risks within our global risk management policy in order to mitigate or eliminate them, and we ensure the defense of the legitimate interests of the Company if we must assume said risks in the event that common understanding with the tax administration is not possible.

  • Some examples of our application of responsible tax policies:

- Fiscal Control Framework in line with best standards and validated by an independent expert.

- Incorporating tax risks into the Group’s core risk management system.

- Approval by the Board of Directors of the Fiscal Policy. Monitoring by the Board of Directors of the implementation of the strategy and the management of fiscal risks at least once a year.

- Concluding mutual procedures and agreements with tax administrations regarding a range of matters.

5. We are committed to transparency being the basis of our actions in exercising tax functions and we endeavor to:

  • Not use opaque or contrived corporate structures to hide or reduce the transparency of our activities.
  • Not operate in non-cooperative jurisdictions unless it is necessary for business reasons.
  • Comply with the best external reporting standards on tax policy in order to facilitate understanding of our tax contributions and tax policies.
  • Some examples of our transparent management:

Publication of the Country by Country Report (CBC) and Tax Contribution Report.

- Leaders in Spain and in the EU in terms of transparency and responsible tax affairs according to various social analysis opinion panels.

- Corporate structure aligned with the business and in line with legal requirements and corporate governance standards.

- Elimination of dormant companies in the corporate structure.

- Incorporating tax-related objectives into Repsol’s Global Sustainability Plan.

- Adherence to the B-Team's principles of fiscal responsibility, with full compliance according to a bilateral review carried out with another member company of this organization.

- Active dialogue with NGOs.

Panoramic shot of the Repsol Campus