Introduction
We are a leading global materials company engaged in the manufacture and marketing of plastics and latex binders, including various specialty and technologically differentiated products. Our products are incorporated into a wide range of our customers’ products throughout the world, including products for automotive applications, carpet and artificial turf backing, coated paper, specialty paper and packaging board, food packaging, appliances, medical devices, consumer electronics and construction applications, among others. As of 2 November 2022, we have approximately 3,400 employees, with 40 manufacturing plants (which included a total of 81 production units) at 33 sites across 15 countries, including the Company’s joint venture. We market our products in more than 80 countries through direct sales and local distributors. These business activities generate a substantial amount of taxes. These include both corporate income taxes and non-income taxes such as property taxes, VAT/sales & use taxes, and other taxes.
We operate in an industry that is stringently regulated. Trinseo is committed to a culture of compliance, including a culture that promotes the prevention, detection and remediation of conduct that does not comply with applicable laws, rules and regulations.
Trinseo‘s Code of Business Conduct requires that all its books and records accurately and fairly reflect its transactions, and our approach to tax aligns to that code.
Our tax approach is based on the following principles:
1. Tax Risk Management and Governance
Our tax risk management follows Trinseo’s Delegation of Authority and applicable internal control processes. Our tax risk management covers all tax processes including tax planning, accounting and compliance. Tax risks are identified through early assessment and appraisal of changes to tax legislation, business decisions and the external environment within which we operate. We apply risk management controls over tax compliance and monitor effectiveness of tax compliance activities of all group companies. This reflects our commitment to ensuring we comply with the requirements of each of the countries in which we operate.
Our global Tax department is responsible for implementing Trinseo’s tax approach, which has been approved by the Trinseo Board, and ensuring global compliance with this approach by all Trinseo Group companies. Global Tax department is responsible for ensuring that policies and procedures that support this approach are used consistently throughout the group, and is supported by an experienced team of tax professionals with the expertise to implement this approach.
The global head of Tax reports directly to the Trinseo group Chief Financial Officer and reports on a periodic basis to the Board of Directors providing updates on how tax risks are managed, and on improvements that are being made.
2. Tax Planning
Our tax arrangements are derived from the commercial needs of our business operating model, and that minimizes tax risk in respect of compliance, uncertainty, cross border transactions and disputes.
Trinseo operates through legal entities, which are established in countries where we undertake business operations or financing activities. All transactions between group companies are conducted on an arm’s length basis in accordance with OECD or other applicable principles and supported by appropriate documentation and studies.
Trinseo does seek to utilize tax incentives and exemptions where these are made available by governments or tax authorities in the countries we do business in. Where possible, we will seek to engage with local tax authorities to ensure there is an agreed understanding of the basis and validity on which we will claim tax incentives or exemptions.
Trinseo uses external tax advisers where specific expertise is required, as well as for mitigating tax risks and complying with all tax laws.
3. Transparency and Relationships with Tax Authorities
Trinseo fully supports the moves towards greater transparency with tax authorities and the initiatives being introduced to enable this. We recognize the needs of society to raise taxes, and we are fully committed to meeting our legal obligations in this respect.
We believe in being proactive with tax authorities, both in terms of early communication and to obtain agreement on areas which reduce uncertainty for both Trinseo and the tax authorities. Our relationship with tax authorities is based on respect for the function they are performing and the legal framework in which we operate.
We review and update this annually. It was last updated on 19 December, 2022.