Taxation

Providing NXP taxation principles, approach, governance and engagements applied across our geographic operational footprint.

Taxation Standards

  • We comply with all applicable tax laws
  • We align our profit allocation with international tax principles
  • We use tax incentives to directly support innovation and R&D
  • We have zero tolerance for tax evasion
  • We have no active presence in countries on the EU’s list of non-cooperative jurisdictions
  • We are open and transparent with tax authorities

Approach to Tax

NXP’s tax strategy – that is, the way we approach, manage and assess the risk of taxation – is grounded in the corporate objective to act as a socially responsible company. The NXP Code of Conduct serves as an ethical framework for taxes and is effectively embedded within the tax strategy and across the tax organization. Hence, NXP’s tax strategy also governs NXP’s relationships with employees, customers and contractors.

NXP aims to support stable, transparent and predictable tax systems that incentivize long-term investments and economic growth. NXP is committed to complying with the letter, the intent and the spirit of the applicable tax laws of the jurisdictions where we operate.

NXP’s tax structure is based on global standards and frameworks supported by the Organisation for Economic Co-operation and Development (OECD). We believe that operating within this framework creates a constant contribution to the advancement of the UN Sustainable Development Goals (SDGs). After a business acquisition, NXP’s Tax Team ensures that the acquired structure will fully adhere to NXP’s Transfer Pricing tax Policy strategy and OECD global standards, further reinforcing our commitment to these principles.

Governance

NXP invests in R&D, manufacturing and go-to-market activities using a cross-functional model, leveraged by multiple organizations globally. The resulting supply chain and product development form the foundation of NXP’s structure for transfer pricing.

Regarding our product-development framework, NXP leverages the available tax incentives and tax regulations in the various jurisdictions where we operate. The most important tax incentives NXP is eligible for are the ones that drive and promote innovation and R&D activities. For example, as a Dutch multinational focused on R&D, NXP qualifies for the innovation box regime, provided by Dutch tax law, which reduces the nominal tax rate for qualified income associated with R&D from 25.8% to 9%. The effective Dutch tax rate for NXP is above 15%.