Executive vice president, tax and corporate structure, Royal Dutch Shell
One thing can be said about the increased public scrutiny of corporate tax affairs: it is divisive when you look at the impact it has had on multinational tax directors. Some shy away, preferring to loiter anonymously in the shadows of spreadsheets and the annals of accounts, reticent and reactive. While others have acknowledged the need to trumpet the tax message on all sides, making sure tax concerns make it into boardroom discussions and making sure a simple and justifiable tax overview is presented to the authorities and public.
McLean falls into the second category. He has been vocal in the areas of tax disclosure and transparency throughout 2013, and has stressed the importance of making information useful, rather than just publicly available. Specifically in reference to country-by-country reporting, McLean has said transparency is not just about making the information public, but about creating meaning out of such data.
Here, he looks back on a busy year, outlining his crowning glories and pointing out further ways for the taxpayer-tax authority relationship to be improved.
International Tax Review: What do you consider to be your biggest achievement or influence in the world of tax?
Alan McLean: I think that through the work of the EU Joint Transfer Pricing Forum we have been able to clarify and simplify the approach to the administration of transfer pricing within the EU in some important areas such as cost-sharing and year-end adjustments; the format of business and member states working together with the Commission is an important and effective one.
ITR: what is your number one priority from a business taxation point of view at the moment?
AM: My number one priority is to manage down the number of open issues we have with tax authorities around the world, and to move onto a more real time collaborative compliance footing wherever possible. This helps reduce risks and uncertainty, as well as being the most efficient and effective means of ensuring compliance as far as I am concerned.
ITR: How are the challenges of running the tax department of a multinational company changing, and how are you adapting to deal with such change?
AM: New challenges, such as the need for more regular and transparent engagement with a wider range of external stakeholders, are emerging on top of ongoing challenges such as dealing with the uncertainty created by changes in tax law and administration. We are developing new skills and capabilities to help us deal with those challenges, and working more closely with different groups inside the company.
ITR: What change to the corporate tax system would you like to see implemented, if you could do so overnight? Will you be lobbying for any specific changes in the year ahead?
AM: More effective mechanisms for timely resolution of disputes and uncertainties in the application of the law in more countries.
ITR: How do you see the present focus on BEPS (and the OECD project) playing out this year?
AM: We are already seeing some jurisdictions moving to implement BEPS-style legislation, pre-empting the final agreed actions from the G20 and OECD work, which I think is an unfortunate sign of things to come. In tackling the challenges of the international tax system, a coordinated approach is needed, with the involvement of tax authorities, taxpayers and other stakeholders. This kind of unilateral action could get in the way of the broader consensus needed to ensure sustainable longer term responses.
The Global Tax 50 2013