In this rapidly changing world, it is increasingly important to consider environmental impact (in accordance with ESG), instead of limiting considerations to financial incentives. Multinational companies should review and potentially reconsider their tax strategy due to the constantly evolving social standards. In respect of such transformation, it is crucial to identify potential risks arising because of a changing environment. For example, in case investing in new assets is being considered, it is valuable to examine whether those assets are environmentally friendly and/or the investments provide energy savings and renewable energy. The Netherlands has introduced several regulations for companies investing in such assets, resulting in significant tax benefits.

How can we help?

Would you like to get a better understanding of the impact of sustainable tax on your company? And would you like some assistance to take the first step from theory to practice? We can help. 

Changing tax landscape: impact on your organisation

The global taxation and regulatory landscape is changing as a result of new legislation, tax management regulations, codes of conduct, and anti-avoidance initiatives. Governments are using tax measures to encourage environmentally friendly behavior in line with the societal norm, increasingly encouraging the use of sustainable and renewable energy. Sustainability is no longer limited to a green environment or climate. It includes issues such as remuneration structures, contributing a fair share to society, and achieving strategic and commercial ambitions in an ethical manner. Consequently, companies must actively manage opportunities and risks to increase their market value and avoid reputational damage. 

For multinational enterprises (MNEs), it is important to prioritize reviewing their tax strategy. It is vital to identify potential risks due to changes (such as sustainability reporting, the CBCR regulations, and the obligations of the second pillar of the OECD initiative, which imposes a global minimum tax rate of 15%) within the tax environment. Only then can you assess the impact of changes in the tax landscape on your business activities. It is a multifaceted and complex area that requires the attention of every business. 

Some common challenges include: 

  • How much has my company contributed to energy-saving measures, environmental sustainability, and innovation? And what are the applicable sustainable tax incentives, energy taxes, and local taxes?
  • To what extent is my company generating and/or using renewable energy, emitting less CO2, investing in environmentally friendly techniques/means of production, and reducing its reliance on fossil fuels?
  • To what extent has our sustainable (tax) strategy been implemented, monitored, and evaluated?
  • Is my tax department already using technology and data?
  • Is my company prepared for the growing demand for transparency in reporting and communication?

What can we help you with?

Grant Thornton's Tax Sustainability team assists organisations by providing insights into available taxes and grants. We are happy to assist in designing and implementing a sustainable tax strategy. Moreover, with the development of our database tool, companies will soon be able to navigate any sustainable tax incentives within Europe and determine which countries offer the best investment outcomes for your sustainable (tax) purposes. Our risk management tool simplifies managing (tax) risks and substantiate (tax) compliance in sustainability.

By utilizing our international network, our specialists know how to deal with national and international complexities. Our team's services cover a wide range, including:

  • Identifying financing and incentive prospects;
  • Streamlining supply chain management;
  • Monitoring and simulating tax policy;
  • Managing staff and labor;
  • Complying with tax planning and regulations;
  • Providing legal services related to sustainability;
  • And submitting reports to governmental and non-governmental organizations.