It is a priority to clearly explain our tax contribution
Breakdown of tax information
It is a priority to clearly explain our tax contribution
To explain the importance of Endesa's tax contribution properly is a priority for the company from the point of view of transparency and corporate social responsibility.
Tax Contribution Report
Adequate explanation of Endesa´s tax contribution is a priority of the company from a transparency and corporate social responsibility perspective.
In line with this, since 2014, Endesa has been publically providing a breakdown of the principle taxes paid in the countries in which it operates, which reflects the importance given by the Group to tax issues and its level of commitment to the principle stakeholders.
Total tax contribution 2018
Endesa's total tax contribution in 2018 amounted to Euros 4.086 million, with 40% of this total corresponding to taxes borne and 60% to taxes collected.
(*) Source: PwC
o Taxes collected: 60%
o Taxes borne: 40%
o 4.086 million
Taxes borne in 2018
Taxes borne by Endesa in 2018 amounted to Euros 1.650 million. A major parte of thus total corresponds to enviromental taxes, which amount for 51% of taxes borne.
Among enviromental taxes borne by Endesa, the main item is the tax on the value of electricity generated.
51% Environmental taxes
1.650 million
(*) Source: PwC
Taxes collected in 2018
Taxes collected by Endesa in 2018 amounted to euros 2.436 million. A major part of this total corresponds to taxes on products and services - primarily VAT -, which account for 62% taxes collected.
62% VAT
2.436 millones.
Tax contribution of Endesa with respect to turnover in 2018
In relation to the size of its business, for every Euros 100 of net revenues obtained by the Company, Euros 21 are used in the payment of taxes. Of this amount, Euros 8 correspond to taxes borne and Euros 13 to taxes collected.
(*) Source: PwC
Tax contribution: 21%
Collected: 13%
Borne: 8%
Total tax rate 2018
Endesa's Total Tax Contribution Rate for 2018 is 53%. In other words taxes borne account for 53% of total income before al taxes borne for the purposes of the Total Tax Contribution.
53%
(*) Source: PwC
Distributed tax value* 2018
64% of the value generated by Endesa has been paid to the Public Treasury in the form of taxes borne and taxes collected. Of every Euros 100 of value generated by the group en 2018, Euros 64 were therefore used in the payment of taxes.
64%
(*) Source: PwC
Geographic distribution of the tax contribution in 2018
Of every Euros 100 of taxes paid by Endesa worldwide, Euros 92 are paid in Spian, this figure being indicative of the importance of Endesa's contribution in this country.
(*) Source: PwC
o Spain: 92,3%
o Portugal: 3%
o France: 2,6%
o Germany: 1,7%
o Holland: 0,3%
o Morocco: 0,1%
Total amount of payments made to Public Administrations
Payments made by Endesa to Public Administrations in 2018, including payments in respect of the rates subsidy and energy efficency charges and other regulatory payments, amounted to a total of Euros 4.205 million.
(*) Source: PwC
Total Tax Contribution (TTC): 4.086M€
Rates subsidy: 90M€
Energy efficency: 29M€
Total: 4.205 million
Financial Tax Information
On the other hand, it is important to highlight that all of the information related to the configuration of Endesa´s Tax Expense is contained in detail in its Consolidated Financial Statements and in the Standalone Financial Statements and those of each subsidiary, specifically in Note 32 denominated Corporate Income Tax. Therein exists a detailed composition of the tax expense and a conciliation between the accounting result and tax base, between the amount of tax to be paid and the tax expense and between the accounting result and the tax expense.
Additionally, in the Endesa´s Consolidated Financial Statements and in the Standalone Financial Statements and those of each subsidiary, specifically in Note 17.3, a detailed breakdown is given regarding the principle relevant tax litigations.
Non-Financial Tax Information
The Law 11/2018, of 28th December modifies the Commercial Code and the Law of Capital Companies obliging in certain cases the inclusion of specific tax information in the non-financial information section of the financial statements of companies and groups: the earnings obtained country by country, the taxes on earnings paid and the public grants received. The corresponding information for the Endesa Group has been verified by an independent service provider as follows:
Country
- Spain
o Total income 2017 : 18.238
o Earnings before taxes 2017: 2.020
o Tax on earnings 2017: 316
- Portugal
o Total income 2017: 1.079
o Earnings before taxes 2017: 19
Tax on earnings 2017: 13
- France
o Total income 2017: 428
o Earnings before taxes 2017: -41
o Tax on earnings 2017: 21
- Germany
o Total income 2017: 268
o Earnings before taxes 2017: -2
- Holanda
o Earnings before taxes 2017: 1
- Marruecos
o Earnings before taxes 2017: 7
Country
- Spain
o Total income 2017 : 18.323
o Earnings before taxes 2017: 1.798
o Tax on earnings 2017: 338
- Portugal
o Total income 2017: 1.079
o Earnings before taxes 2017: 19
- France
o Total income 2017: 554
o Earnings before taxes 2017: -7
o Tax on earnings 2017: -12
- Germany
o Total income 2017: 239
o Earnings before taxes 2017: -2
- Holanda
o Earnings before taxes 2017: 1
- Marruecos
o Earnings before taxes 2017: 7
- Public grants received 2017: 315
- Public grants received 2018: 287
*Amounts in millions of €.
The criteria for determining the accounting result is on a consolidated basis. The data corresponding to Tax on Profits corresponds with the Corporate Income Tax paid in the reference period taking into account amounts paid which derive from Notices of Assessment arising from Inspections. In this case, ENDESA and its 100% controlled Spanish resident subsidiaries form part of a Tax Consolidation Group, the head of which is Enel S.p.a with Enel Iberia, S.L. being the representative entity of the Tax Group which, in accordance with the tax legislation, declares and pays the tax of the Tax Group to the Tax Authorities. On the other hand, for the remainder of the subsidiaries of the consolidated mercantile group that do not form part of the Tax Consolidation Group, the amount paid to the Tax Authorities has been taken into account.
Morocco consolidates in the Group using the equity method; accordingly, the accounting result corresponds to the earnings after taxes expressed in the percentage held by Endesa.
Presence in low tax territories
The policy of Endesa is not to carry out investments in or through territories classified ad tax havens with the aim of reducing its tax burden. Furthermore, Endesa has never made use of entities domiciled in tax havens for the purpose of hiding the true owner of incomes, activities, goods or rights.
It is true that Endesa carries out some non-relevant activities in another country, which, without being considered as a tax haven by the Spanish Tax Authority, certain externals observers consider it as a territory that benefits from a tax regime more favourable that the Spanish one, as could be the case with The Netherlands.
What is certain is that, neither the activities carried out by the company in this geographic area, nor the legal qualification given by the Spanish Tax Administration to this country, justify the inclusion in this type of list of privileged tax jurisdictions. However, being conscious of the importance that the company appreciates that it always acts with complete transparency, Endesa considers that it is convenient to inform about the activities carried on by its subsidiary in The Netherlands.
In any event, it is important to mention that The Netherlands have signed an Agreement for the Prevention of Double Taxation with Spain with an interchange of information clause and maintains a rate of Corporate Income Tax very similar to the current Spanish rate.
Endesa´s only financial participation in the country is the 100% holding in International Endesa, B.V (IEBV)., a Dutch company, incorporated in 1993 in order to raise debt funding for the Endesa Group through the debt issuance Euro Medium Term Note (EMTN) programme and the Euro Commercial Paper (ECP) programme. The last quoted debt issuance was made by IEBV in 2003, currently leaving the issuance of ECP as the only activity. The company is considering the possible transfer of this activity to Spain to be be carried out by Endesa S.A., a Spanish resident entity.