Summary of content changes
New content in the Tax Contribution Report 2020:
- Disclosure of the total tax contribution for five key operating jurisdictions in 2020: the UK, the USA, the Netherlands, Nigeria and India. This is aligned with our Powering Progress Strategy Day 2021 disclosure.
- More transparency on our use of tax incentives, including through case studies, in the Special Topics section.
- New case study on decommissioning in the Special Topics section. This shows how decommissioning is treated for tax purposes in the UK and Kazakhstan.
- The total number of 99 countries has not changed but we have added Ghana and Suriname and excluded Mongolia and Palestine because of the closure of activities there.
This Tax Contribution Report details the corporate income tax we paid in 2020 and follows how our activities were organised in 2020. In 2021, we announced our updated strategy, Powering Progress. This sets out how we plan to accelerate the transition of our business to net-zero emissions, in step with society’s progress in achieving the goal of the UN Paris Agreement on climate change. Powering Progress is designed to integrate sustainability with our business strategy, profitably and in support of our purpose – to power progress together by providing more and cleaner energy solutions. We will deliver our strategy through our three business pillars of Growth, Transition and Upstream.
Corporate income tax
This is a direct tax imposed on companies’ profits. It is sometimes levied at a national level but can also be levied on a state or local basis.
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Tax incentives
There is no common definition of a tax incentive. Shell defines tax incentives as fiscal measures designed by governments to stimulate investment and encourage growth, or a change of behaviour, by providing more favourable tax treatment to some activities or sectors. Incentives can include accelerated tax relief for capital expenditure on infrastructure, exemptions from certain taxes where government economic targets (for example employment targets) are met, or a favourable tax treatment of costs related to research and development activities for certain technologies.
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