Following the Organisation for Economic Cooperation and Development's (OECD) base erosion and profit shifting (BEPS) initiative, tax authorities worldwide are seeking effective methods to identify and attribute profits to their jurisdiction correctly.
Furthermore, various U.S. tax reform provisions in the Biden Administration FY22 budget, and the Treasury Department Greenbook explanation of Biden's tax proposals, could create adverse tax consequences for certain related-party transactions. Conversely, they may now present planning opportunities. Given the exponential rise of comprehensive tax policies and globalization demand for tax-related transparency in the transfer pricing landscape, here are the top transfer pricing issues that multinationals should consider:
What will you do now?
As business and government intensify scrutiny over the tax impact of cross-border transactions, the need to improve transfer pricing
management remains a hot topic. Taxpayers that take a proactive approach to assess their transfer pricing arrangements can improve their
compliance with transfer pricing regulation and mitigate your company’s risk of audit.