Our Tax Principles
Eli Lilly and Company and its subsidiaries around the world (“Lilly”) pay a significant amount of taxes to local, state, provincial, regional and national governments including taxes on profits, social taxes on employment, taxes on property, excise taxes on purchases, customs and duties, withholding taxes, environmental and other taxes. In addition, our businesses collect sales and value-added taxes and other similar transactional taxes charged to our customers. We also collect numerous taxes paid by our employees. Lilly pays all taxes due in full and on time in the geographic jurisdictions in which we operate.
The principles guiding Lilly’s global tax affairs consist of the following:
Lilly is committed to complying with all applicable tax laws, rules, regulations and related disclosure requirements and will pay the correct amount of tax due based on such tax laws, rules and regulations of the jurisdictions in which we operate.
Lilly will interpret applicable tax laws using relevant guidance and apply diligent professional care and judgment to arrive at well-reasoned conclusions, including discussing such conclusions with tax authorities where appropriate.
Lilly will seek certainty in its tax conclusions but, where tax law is unclear or subject to interpretation, written advice will be sought as appropriate to understand and minimize risk.
Lilly will ensure all material tax-related conclusions are made at the appropriate level and supported with documentation that evidences the facts, determinations and risks involved.
Lilly will manage its tax affairs efficiently to enhance shareholder value, maintain global competitiveness and deliver shareholder returns, always guided by our Lilly brand and business integrity.
Lilly will reduce its tax liabilities within the laws of the countries in which it operates including claiming properly available allowances, deductions, reliefs, incentives, exemptions and credits where it is beneficial to do so.
Lilly aligns its tax affairs with its commercial investments and business strategies.
Lilly’s tax risk is integrated within the Company’s enterprise risk management and compliance framework with significant tax strategies overseen by the Finance Committee of the Board of Directors.
Lilly will seek to have open and constructive working relationships with tax authorities and government bodies, all based upon our Lilly values of integrity, excellence and respect for people to minimize disputes and risks.
Lilly will enter, where appropriate, into continuous audit programs and advance pricing agreements to enhance certainty on the tax treatment of our business.
Lilly will seek to influence applicable industry bodies and associations, governments and other external bodies where possible and appropriate to shape future tax legislation and practices in a manner that balances Lilly’s business interests with sound public policies for the relevant government/governmental authority.
Lilly will actively manage and monitor adherence to the above tax principles.