"Supporting Statement
Tax Avoidance Impacts and Controversies There has been increased government and community scrutiny on whether corporations are paying a “fair share” of tax and contributing to societies where profits are earned. In an annual Deloitte global taxation report, 77% of companies are concerned about the continuing high interest of media, political and activist groups in corporate taxation.1 The OECD estimates revenue losses from profit shifting by corporations of US$100 – 240 billion annually.2 The PRI, representing investors with $89 trillion AUM, argues that tax avoidance is a key driver of global inequality.3 According to a report from Canadians for Tax Fairness, tax avoidance is driving inflation, in turn contributing to the increased cost of living in Canada.4,5 Global Tax Reporting Initiatives In October 2021, 136 countries agreed to a framework for global tax reform.6 In the United States, the proposed Disclosure of Tax Havens and Offshoring Act will require public country-by-country (CbC) reporting of financial and tax data. In November 2021, the European Union approved a directive to implement a form of public CbC reporting for multinationals operating in the European Union with group revenue of over $860 million.7 In Canada, private CbC reporting has applied to multinational groups such as Brookfield since 2016.8
Brookfield’s Tax Structuring and Disclosure Brookfield topped a list of Canadian companies that avoided paying the largest amount of income tax from 2017-2021.9 Brookfield’s operating business is carried out through its “perpetual affiliates”, each of which are limited partnerships (LPs) formed under the laws of Bermuda. Bermuda imposes no corporate income, capital gains or withholding taxes.10,11 Complex and opaque corporate structures allow companies to record revenue and profit in low-tax jurisdictions even if it was not generated in that jurisdiction.12 Currently, Brookfield’s limited tax disclosure challenges investors’ ability to evaluate the risks to our company of taxation reforms, or whether Brookfield is engaged in responsible tax practices that ensure long term value creation for the company and the communities in which it operates. Shareholders believe that enhanced information in this regard would ensure risks are being adequately managed.

Global Tax Reporting Standards The GRI Standards are the world’s most utilized reporting standard,13 having been developed in response to investor concerns regarding the lack of corporate tax transparency and the impact of tax avoidance on governments’ ability to fund services and support sustainable development.14, 15 This proposal would bring our company’s disclosures in line with leading companies who already report using the Tax Standard.16 Our company already reports BEPS Action 13 CbC information with the Canada Revenue Agency privately (which is automatically shared with OECD jurisdictions in which Brookfield operates), so any increased reporting burden is negligible."