We are delighted to feature an interview with Sam Barrett, Head of International Tax & Global Transfer Pricing at Sandvik, and former Global Transfer Pricing Manager at Kimberly Clark.
Why did you get into tax?
I got into Transfer Pricing in particular because I love the fact that every working day is different and involves stakeholders from all corners of a business. Being successful in Transfer Pricing involves having well-rounded skills in not just tax, but finance, law, economics, accountancy and most importantly having commercial acumen. In my experience the more I understand exactly what a business does and its commercial value drivers, the better I can do my job. Tax skills are clearly very important but so are the others.
Who has been the most influential role model for your professional life?
I have had a few bosses – one in Mexico, one in Luxembourg and one in the US, that have helped me on my journey. One gave me an opportunity when others wouldn’t necessarily have done so. He helped introduce me to Transfer Pricing and gave me a great grounding – something for which I will be eternally grateful. As well as being wonderful personalities, the other two were technically brilliant, who I learnt a lot from, and who gave me a lot of guidance but also autonomy to have opinions, to lead and to grow in difficult organisations. I am still in touch with all three today.
What do you see as the biggest trend affecting the tax world over the next 10 years?
In a word – BEPS! Most people are already fed up with it and it hasn’t even taken hold yet! I think three areas will be key – Transparency, Substance and Controversy. Everything we do nowadays from a tax and TP perspective, we have to assume at some point will become public. More so than ever before, we have to be prepared to be able to fully justify our positions and approaches in accordance with both the arm’s length principle as well as from a reasonableness and fairness perspective, potentially to stakeholders who are not tax specialists. Aggressive tax planning which lacks substance is not possible anymore. Operational, tax and legal structures need to be aligned with the location of profits in the value chain. Having to perform this exercise will, I am sure, surprise a lot of organisations showing that they are not necessarily aligned with this. Finally, Country by Country Reporting (“CbCR”) will bring all of this together – transparency, substance and controversy. Companies will now need to be more transparent than ever with their transfer pricing. This will clearly need to be based on substance, and if the CbCR suggests otherwise, controversy in multiple jurisdictions will be the result.
BEPS and tax risk management generally are placing huge demands on in-house tax functions. What approaches have you found helpful in getting the most out of the resources available to you?
Alerting US tax departments and non-tax stakeholders to the potential risks, which could be huge, both from a resource and tax risk / tax adjustment perspective, has been key. I think companies are going to be surprised how much additional resource this will require. Being prepared has also been key – ensuring access to data for CbCR is possible and dry runs are complete to report scenarios to tax leadership ahead of time is always welcome and could justify additional resource.
In a movie of your life story, which actor or actress would you like to play you?
Colin Farrell or Johnny Depp.
What would be your dream job if you didn’t work in tax?
A pilot. I love travelling and experiencing new places and cultures while meeting new people.
What is your biggest extravagance?
I don’t really have any. Maybe watches and travel.
What do you do to relax?
I like to sit in the sun and read when I can. Holidays to warmer climates and socialising also help…
What is your favourite holiday destination?
So far it has been Mauritius. A great mix of beautiful beaches, weather, people and rum!
What piece of advice would you give your 25-year-old self?
Do a job you enjoy and are passionate about. Learn something new every day. Learn some other languages. And whatever you do make sure you have fun …