The Platform for Collaboration on Tax – a joint initiative of the IMF, OECD, UN, and World Bank Group – on 24 January released a draft toolkit addressing ways that emerging economies can overcome lack of comparable data or market prices for goods and services in the area of transfer pricing. The Platform has asked for comments and input on the draft by 21 February from interested stakeholders to finalise the toolkit.
The toolkit, which will be available in French and Spanish, is part of a series of initiatives aimed at assisting emerging countries in designing and administering strong tax systems.
The toolkit is designed to help emerging countries foster strong and credible transfer pricing regimes applying the principles developed in the OECD/G20 base erosion profit shifting (BEPS) project and, hence, protect their tax bases from aggressive or inappropriate tax planning by multinational corporations.
The toolkit addresses some of the challenges associated accessing comparables data. It also focuses on how to make the best use of available data and on the importance of the choice of the most appropriate transfer pricing method.
It also describes issues and possible solutions when adequate data on transactions between independent parties are not available, including the potential for developing safe harbours or prescriptive approaches. Finally, due to the complexity of the topic, the toolkit sets out areas where further work is planned, and summarises a number of conclusions.
In addition, in recognition of the importance of the extractive industries and other commodities sectors to the economies of many developing countries, the draft toolkit addresses the information gap on prices of minerals sold in an intermediate form.
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Davide Anghileri
Davide Anghileri is a PhD candidate at the University of Lausanne, where he is writing his thesis on the attribution of profits to PEs. He researches transfer pricing issues and lectures for the Master of Advanced Studies in International Taxation and Executive Program on Transfer Pricing.
Anghileri, a Contributing Editor at MNE Tax, previously worked as a policy advisor to the Swiss government on BEPS issues.
Davide can be reached at [email protected].
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