Weekly transfer pricing roundup – 1 July

15641898450_deb45cce3c_bThis week has been a lot of traction on CBCr with the US confirming it will be doing it, and the OECD releasing additional guidance on CBCr. Happy reading.

OECD releases guidance on the implementation of country-by-country reporting (OECD)

Following the endorsement of the BEPS Package by G20 Leaders in November, the focus has now shifted to ensuring a consistent implementation, including of the new transfer pricing reporting standards developed under Action 13 of the BEPS Action Plan. To that aim, the guidance released today sets out:

  • Transitional filing options for MNEs that voluntarily file in the Parent jurisdiction;
  • Guidance on the application of CbC reporting to investment funds;
  • Guidance on the application of CbC reporting to partnerships; and
  • The impact of exchange rate fluctuations on the agreed EUR 750 million filing threshold for MNE groups.

Advertising, marketing tax may come back to haunt MNCs (ET Brand Equity)

The revenue department has challenged a judgment favouring a taxpayer on advertising, marketing, and (sales) promotion (AMP) expenses in the Supreme Court, which could potentially open a can of worms for many multinationals regarding a transfer pricing issue, assumed to be resolved…

Costa Rica: Update On Costa Rica’s Regulation For Annual Transfer Pricing (Mondaq)

Earlier this month, the Costa Rican General Direction of Taxation released draft rules for annual transfer pricing for public consultation. Originally enacted in 2013, Decree 37898-H protects the principle of ‘free competition.’

Costa Rica’s transfer pricing rules follow guidelines set by the OECD…

European Commission publishes decision on Netherlands’ state aid to Starbucks (Out-Law.com)

The European Commission has published the non-confidential version of its 2015 decision on state aid granted to Starbucks by the Netherlands.

The decision gives details of the Commission’s investigation into the Netherlands’ tax and transfer pricing rules, and its reasons for deciding that the country’s APA with Starbucks constituted illegal state aid…

U.S. Finalizes Country-By-Country Tax Reporting Rules — Are Companies Ready To Comply? (Forbes)

The U.S. Treasury Department and IRS released final rules today that will require large U.S. multinational corporations to file annual reports containing detailed, country-by-country income tax filing information for each country in which they do business.

The move, which was the subject of a good deal of controversy between several members of Congress and Treasury Secretary Jack Lew, aligns U.S. corporate tax policy with the global guidelines proposed by the OECD in its BEPS project…

36 non-OECD, non-G20 countries join BEPS international tax effort (MNE Tax)

Thirty-six countries and jurisdictions that are neither OECD nor G20 members have joined the framework to implement the OECD/G20 BEPS project to combat multinational tax avoidance, and 21 more are expected to join in the coming months, according to a June 30 OECD announcement.

The commitment means that the countries have agreed follow OECD/G20 BEPS minimum standards, namely, to add language to their tax treaties to prevent treaty shopping; join OECD/G20 agreements on country-by-country reporting for transfer pricing; limit benefits of intellectual property or other preferential tax regime based on an agreed method that requires substantial activity; and fully implement the mutual agreement procedure (MAP) in their tax treaties by resolving MAP cases within an average of 24 months, funding MAP administration, and ensuring that qualified taxpayers have access to MAP. The countries must also pay a fee to participate…

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