The South African Revenue Service on November 11 published a discussion paper seeking public feedback on the potential establishment of an advanced pricing agreement program.
Comments on the paper are requested by December 18.
According to the tax authority, South Africa is not yet ready to implement an advance pricing agreement program as the country still must build its transfer pricing capacity. Nonetheless, given that it takes many years to develop such a program, the revenue agency recommends that the process begin now.
The first steps would include planning and the drafting of advance pricing agreement legislation. The discussion paper offers many suggestions for the design of such legislation.
The South African Revenue Service also suggests the adoption of a phased approach to implementing an advance pricing agreement program and assumes it will take three or four years to get the program up and running.
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