Taxation

Taxation

H&M is always tax compliant and our tax policy always reflects our business. All taxes and fees are paid according to local laws and regulations in the countries where we operate.

H&M pays its taxes at the appropriate times. The H&M Group’s tax rate depends on the results of its various companies and the corporate tax rates in each country.

We provide without delay, any relevant information requested by the appropriate tax authority to accurately establish the company’s tax liabilities. H&M’s internal transfer pricing model is fully in line with the OECD Transfer Pricing guidelines.
 
In 2007, H&M reviewed and refined its group structure to allow for substantial future expansion and to simplify the supply of goods by dividing our sales countries into regions. This was also done in order to meet OECD guidelines on transfer pricing and tax. H&M complies with current tax legislation and the company’s group structure shows clearly where actual value is added, which under OECD guidelines decides how profits are distributed and taxed in international companies.
 
H&M does not own any factories, but instead buys its products from independent suppliers in production countries such as Bangladesh and Cambodia. H&M thus has no revenues in these countries and therefore does not pay corporate tax there. However, tax revenues other than corporate tax are generated in the production countries via H&M’s employees at the local representative offices in the form of social security payments, and also via the employees’ income taxes.

For more information on Swedish companies’ tax liability in other countries, please see attached letter from Staffan Andersson, the Chairman of the ICC’s Swedish reference group on tax and member of the ICC’s commission on Taxation.

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