Tax Practice and Philosophy
This document sets out the strategy and approach of the General Mills companies within the UK as to the management of its tax affairs and risks. This Tax Strategy has been endorsed by the UK Board of Directors and prepared in accordance with Schedule 19 of Finance Act 2016 and applies for the financial year ended 28 May 2023.
For 150 years, General Mills has been making food people love while investing to make the world around us better. We believe that being successful in the marketplace and being a force for good go hand in hand. Although a substantial majority of our business is in the U.S., our presence in Europe, Asia, and Latin America continues to grow. General Mills contributes to society through various taxes such as corporate income taxes, duties, payroll taxes, and also indirectly through VAT levied on the products sold to consumers. All taxes are paid according to the laws and regulations in the countries where we operate. General Mills sees tax as an important part of its corporate social responsibility.
Tax compliance and governance begins with our global tax department, which is headquartered in the U.S., with teams in Europe and Asia, and is staffed with experienced, professionally certified practitioners (e.g., accountants, attorneys, and paraprofessionals). In addition to global responsibility for tax planning and audit representation, the General Mills Tax Department ("Tax") is responsible for tax-related regulatory compliance and financial reporting.
General Mills is a publicly traded corporation registered in the U.S. and must therefore comply with reporting requirements of the U.S. Securities and Exchange Commission. Consequently, an independent accounting firm audits our financial statements annually, including all of the tax accounts and disclosures. Additionally, our internal audit group reviews our processes and controls, with emphasis on enterprise risk management. Finally, Tax leadership provides annual updates to the Audit Committee of the Board of Directors, which entails a review of global tax developments and Tax policies and practices.
Within the UK, the Senior Accounting Officer ("SAO") has responsibility to ensure we have in place the appropriate systems, processes and people to enable the UK-resident companies within the General Mills Group to pay the right amount of tax on time.
Our Approach to Tax Risk
We have a fiduciary responsibility to optimize shareholder return while operating in a responsible and sustainable manner, following our corporate value of "doing the right thing, all the time". Our general view is that income and profits should be taxed where the value is created in accordance with the OECD guidelines. As a result, any significant tax planning initiated by General Mills is carefully considered by Tax and, in addition to the reviews and controls mentioned above, is:
- Consistent with business operations and priorities;
- Supported by economic substance and business purpose; and
- Supported by arms-length pricing, updated and documented annually, on any intercompany, cross-border transactions.
We always aim for compliance with the spirit and letter of the tax laws under which we work. However, the application of new laws to our business or of existing laws to new initiatives may not always be clear. Therefore, where needed and appropriate we engage reputable tax advisors to assist us with the interpretation of any complex new laws and to confirm the application of existing laws to our business operations. We also engage third party advisors in the preparation of our direct and indirect tax returns.
Transparency & Relationship with Tax Authorities:
At General Mills, our commitment to transparency extends beyond our food and processes. We believe transparency is key to our sustainability engagement, which focuses on real accountability for issues affecting the community, the environment, and consumer wellbeing.
Our UK affiliates are periodically audited by HMRC and in all cases the audits have been concluded efficiently and cordially. We have a regular dialogue with HMRC through our Customer Compliance Manager, provide updates on significant issues affecting the business that could affect the tax profile of the UK group, and seek HMRC's view on uncertain items.