Approved by Eni’s Board on 24th of May, 2018.
Our businesses give us the opportunity to make a significant contribution to tax revenues in many jurisdictions, so contributing to economic and social development of the countries in which we operate. As well as taxes on profits, our activities are subject to other forms of taxation, such as royalties on extraction of hydrocarbons, excise duties on production and consumption, turnover taxes such as VAT, payroll taxes, local taxes and other minor taxes.
ENI is aware of the importance of such revenue flows for collective wellbeing and therefore adopts a behaviour that is in line with the principles of transparency, honesty, integrity and good faith prescribed in its Ethical Code.
The primary objective of this Tax Strategy is to ensure payment of taxes in the various countries in which ENI operates, in accordance not only with the letter but also the spirit of applicable laws.
Determining a fair amount of taxes due in each jurisdiction in which we operate and minimizing the risks of tax disputes are the purposes of Eni’s tax strategy.
Our management decisions are driven by industrial and commercial objectives, and tax considerations are only relevant as a support to the realisation of those objectives. Eni wishes to reduce tax risk to a minimum and, to this purpose, we have specific controls aimed at ensuring accuracy and timeliness of settlement and payment of taxes, in the context of transparent and accurate compliance aimed also at the prevention of possible disputes. To this purpose ENI encourages prior consultation with tax authorities, and the use of statutory procedures in place for that purpose. Our subsidiaries engaged in exploration, development and production of hydrocarbons pay taxes on profits from Oil & Gas activities in the countries where the reserves are located, and in line with contractual and tax rules there applicable. ENI does not operate in such a way as to facilitate tax evasion by persons acting on its behalf.
ENI adopts the principles established in the 2011 edition of the OECD’s “Guidelines for Multinational Enterprises”, which require companies to:
ENI does not use so-called “aggressive tax planning”, which consists of artificial structures put in place merely to save tax, or of transactions lacking economic substance aimed at obtaining undue tax advantages. We make use of tax incentives and concessions in a transparent way.
Except where needed due to justified operating requirements, ENI does not establish or locate residence of its subsidiaries in countries that do not follow international standards of transparency and exchange of information on tax matters or in low tax countries. Where ENI obtains control of such companies, in the absence of material disadvantages it works towards liquidating or re-domiciling them. In its annual financial statements ENI declares such companies, indicating for each of them the applicable tax regime under Italian legislation on “Controlled Foreign Companies” (“CFC rules”).
So as to eliminate or reduce cases of double taxation, ENI applies the rules in relevant “International Conventions for the elimination of double taxation with respect to taxes on income and capital and the prevention of tax evasion and avoidance” following interpretative guidance from the OECD or United Nations. To the same purpose, ENI encourages the use of instruments in national legislation to remove legal and economic double taxation, such as tax consolidations and fiscally transparent structures.
Where available, ENI makes use of procedures intended to eliminate or reduce tax disputes such as Advanced Pricing Agreements and rulings to regulate in advance circumstances where the legislation could be open to more than one interpretation.
ENI aims to maintain a relationship with the tax authorities characterised by transparency, dialogue and cooperation, and is in principle in favour of taking part in Cooperative Compliance initiatives.
ENI considers that transparency in payments to States, especially in the extractive industry sector, is a fundamental step to promote responsible management of natural resources. ENI has been one of the first companies in the Oil & Gas sector to participate voluntarily in the Extractive Industry Transparency Initiative, which it joined from 2005. With the approval of this policy, ENI publishes its Country by Country reporting data on its website.
Within its internal controls system, ENI has established its Tax Control Framework (a system to manage and control tax risk), the objective of which is to ensure with reasonable certainty that business is managed in line with the principles and objectives of this Tax Strategy, reducing the risk of material breaches to a remote level.
The adoption of the Tax Control Framework takes place through a structured process that includes three stages: i) Assessment of tax risks, ii) Identification and valuation of controls to manage those risks, and iii) Related reporting.
The Tax Management System Guideline defines the rules and methodology to design and set up the Tax Control Framework and to maintain it over time.
The Board of Directors approves the Tax Strategy.
The CFO is responsible for establishing the Tax Control Framework and on an annual basis presents a report evaluating its effectiveness to the Control and Risk Committee, who in turn refers to the Board of Directors, and to the Statutory Audit Board. The report also summarizes the main issues relating to the implementation of the Tax Strategy occurred during the year.
ENI’s tax function works closely with the Lines of Business to ensure possible tax risks are identified and managed adequately. The tax consequences of any non-ordinary course of business transactions are analysed and approved by the persons responsible for the relevant governance aspects.
Inserisci l’indirizzo email con il quale ti sei iscritto a eni.com. Riceverai all’indirizzo indicato la nuova password, che ti consigliamo di aggiornare dopo il primo accesso.
Operation successfully completed. Please check your mail address.