Fiscal 2019 CSR Activity Report - Corporate Ethics and Legal Compliance

Ensuring Tax Compliance

Governance

Toray Group Tax Policy

With the recent release of a policy by the Organisation for Economic Co-operation and Development (OECD) to combat base erosion and profit shifting (BEPS), the complexity of taxation rules worldwide is steadily increasing. Due also to the growing importance of corporate governance related to taxation in Japan, Toray Group recognizes the necessity of highly transparent tax practices and corporate social responsibility. Therefore, the Group has been enhancing its tax compliance efforts based on the Toray CSR Guidelines. To ensure that this initiative can be taken to an even higher level, the Group has once again clarified the basic taxation compliance approach that each employee should take, and established the Toray Group Tax Policy. Toray Group will continue striving to improve its tax compliance while building its tax governance structure to enhance corporate value.

Basic Policy

  1. Toray Group makes efforts to pay taxes appropriately by complying with the tax laws of each country and international taxation rules.
  2. Toray Group makes efforts to enhance corporate value and maximize shareholder value while minimizing tax risks and optimizing tax expenses.
  3. Toray Group will not conduct arbitrary tax avoidance using tax havens or other methods.
  4. Toray Group establishes good relationships with the tax authorities of each country.

Tax Compliance

Toray Group employees (including officers) recognize that complying with tax laws and rules is the best way to minimize tax risks and enhance corporate value. The Group conducts trainings so that employees can ensure tax compliance.

Tax Governance

Toray Group clarifies and implements tax rules within the Group to manage tax expenses and aim for an appropriate tax burden. The Group makes efforts to establish good relationships with tax authorities in each country when cooperation is required.

Other Initiatives

Transfer pricing is becoming more important as global trade increases. The Group therefore strives to allocate income appropriately by calculating transfer pricing using the arm's length principle. Moreover, the Group does not carry out tax planning strategies with the intention of inappropriately reducing Group taxes