The Sherwin-Williams Company – Tax Strategy Disclosure
The Sherwin-Williams Company (“Sherwin-Williams” or the “Company”), founded in 1866 and incorporated in Ohio in 1884, is a global leader in the development, manufacture, distribution and sale of paint, coatings and related products.
Sherwin-Williams has an extensive retail presence throughout the Americas and growing service capabilities in Europe and Asia/Pacific. The business activities are grouped in the following four divisions:
- The Americas Group has 4,267 company-operated specialty paint stores in the United States, Canada and the Caribbean. Furthermore, in Latin America it operates 353 stores and sells through more than 700 dedicated dealer outlets, primarily located in Argentina, Brazil, Chile, Colombia, Ecuador, Mexico, Peru and Uruguay.
- The Consumer Brands Group operates 90 company outlets in Australia and New Zealand and manages a highly efficient global supply chain consisting of 84 manufacturing plants and distribution centers.
- The Performance Coatings Group sells to a growing customer base in more than 100 countries around the world and has around 290 company-operated general industrial, industrial wood, protective and marine and automotive branches.
Sherwin-Williams' products are sold under brands such as Dutch Boy, Krylon, Sherwin-Williams, Valspar, Thompson's WaterSeal, Ronseal, and Minwax.
Sherwin-Williams’ global business activities incur a substantial amount and variety of taxes, including corporate income taxes, stamp taxes, business rates and in the UK employer’s national insurance tax. In addition the Company collects and pays employment taxes and indirect taxes such as VAT. The company is a responsible taxpayer and this is recognized by the tax strategy, which is aligned to our Code of Ethics, and establishes a clear Group-wide approach based on openness and transparency in all aspects of tax reporting and compliance, wherever the company and its subsidiaries operate. The global approach to tax is crucial to support the company’s international growth through acquisitions, the increased emphasis on international content and the strategic priority of building a global business. The Group Tax Department, guided by the tax strategy under which it operates, is both fit for purpose and dynamic enough to enable it to support the continuing development of the operational and geographic make-up of the business.
Risk Management and Governance Arrangements
Tax risk arises due to the geographic breadth of our business, the volume and complexity of tax legislation and differences in interpretation of that legislation. Sherwin-Williams believes that a responsible approach to tax matters is essential for the sustainability of its business. Therefore, the identification, mitigation and management of risks are central to its strategy, and its enterprise-wide risk management processes are designed to effectively manage these risks.
The Sherwin-Williams Board of Directors sets and oversees the risk management strategy and the effectiveness of the Group’s internal control framework. The Company has established policies and put process in place to ensure the integrity of tax filings and other tax compliance in the UK and worldwide, and tax processes are subject to the same level of internal controls, reviews and external audits as the rest of the Company’s businesses.
Sherwin-Williams and its subsidiaries continuously identify and manage the risks and opportunities that may impact the achievement of business plans and strategic objectives, shareholder value and reputation through its risk management process.
Furthermore, many policies are reviewed regularly and updated in relation to changes in national and international legislation, business operations, and business and tax risks identified.
Attitude to Tax Planning and Tax Risk
Sherwin-Williams adopts a conservative approach to tax planning which both supports business activities and has commercial substance.
The Company and its subsidiaries do not use tax regimes considered harmful by the OECD or EU, nor does it interpret tax law in a manner that is contrary to its original intentions.
OECD Guidelines and UK legislation are applied when considering the pricing of intercompany transactions between Sherwin Williams’ UK and other group entities.
Where uncertainty over the interpretation of tax law arises, the Company consults with external advisors and HMRC as necessary in order to minimize uncertainty and risk.
Relationship with HMRC
Sherwin-Williams is committed to engaging in full compliance with all statutory obligations to tax authorities. The Company and its subsidiaries engage with HMRC and other tax authorities in a spirit of cooperation and with professionalism, honestly, openness, integrity and respect.
The Company’s goal is to respond to information requests timely and ensure that information given is accurate, complete and relevant. In the event of a disagreement with HMRC, the Company will use its best efforts to work with HMRC to resolve the issue in a timely and professional manner and ensure that access is given to all relevant data.
Sherwin-Williams employs the services of professional tax advisors to act on its behalf and at times liaise with HRMC, which it considers the best way to beneficially manage its relationship with HMRC.
This document covers the following UK-based companies:
- Sherwin-Williams UK Holding Ltd.
- Sherwin-Williams UK Automotive Ltd.
- Sherwin-Williams UK Coatings Ltd.
- W&J Leigh & Co. Ltd.
- Sherwin-Williams Protective and Marine Coatings Ltd.
- Sherwin-Williams Diversified Brands Ltd.
- Geocel Ltd.
- The Valspar (UK) Corporation Ltd.
- The Valspar (UK) Holding Corporation Ltd.
- The Valspar (UK) Funding Corporation Ltd.
- Valspar Automotive (UK) Corporation Ltd
- Valspar Powder Coatings Ltd.
- The Valspar (UK) Special Holdings Corporation Ltd.
- Inver (UK) Ltd.
- Inver Color (UK) Ltd.
- Quest Automotive (UK) Ltd.
- Quest (UK) Acquisition Ltd.
- Plasti-Kote Ltd.
- This UK Tax Strategy document was reviewed, updated, and approved by the Sherwin-Williams Corporate Vice President of Tax on 22 October 2018.
- The Sherwin Williams Company considers this document to comply with UK legislative requirement under paragraph 16(2) and paragraph 25(1), Schedule 19, Finance Act of 2016