Weekly transfer pricing roundup – 24 July

Africa, including South Africa, is more and more in the news for illicit financial flows (IFF) and specifically transfer pricing. This article mentions that approximately USD854 billion have left Africa from 1970 to 2008 in IFF. It is also estimated that currently Africa is losing USD50 billion per annum. As such, IFF and transfer pricing are still a hot topic in Africa. As you can see from the inclusive framework composition below, other countries/continents (a total of 85 now) are joining the BEPS framework.

Inclusive framework composition (OECD)

The above link provides a list of the current BEPS members as of 15 July as well as the invitees to attending in Kyoto.

New accounting standards may trigger transfer pricing adjustments for multinationals: Experts (The Economic Times)

…multinationals are concerned that the new standards could trigger transfer pricing demands from Indian tax authorities.

Some multinationals will conduct impact analysis of the new accounting standards on transfer pricing, while some, that have faced large transfer pricing tax demands, will try to assess if there could be any problem arising out of transfer pricing, given the new accounting standards…

Taxman signs more advance pricing pacts with MNCs (NDTV)

The tax department on Monday signed seven more unilateral advance pricing agreements (APAs) with taxpayers as it aims to reduce litigation by providing certainty in the domain of transfer pricing.

“The 7 APAs signed today pertain to various sectors of the economy like banking, information technology and automotives,” a Finance Ministry statement said on Monday…

Report proposes African transfer pricing improvements (Tax-News)

The National Resource Governance Institute has released a paper that looks at African nations’ efforts to introduce transfer pricing rules in the mining sector and puts forward policy recommendations.

The study assesses the development and implementation of rules to monitor transfer pricing in the mining sector in countries with varied experiences, looking more in-depth at Ghana, Guinea, Sierra Leone, Tanzania, and Zambia…

South Africa urges African transfer pricing advances (Tax-News)

During a recent speech in Pretoria to the High Level Conference on Illicit Financial Flows, South African Minister of Finance Pravin Gordhan noted that tax code improvements are required in African countries so that multinational enterprises (MNEs) “pay their fair share of taxes in the countries where they generate their profits.”

On the subject of “transfer mispricing and other practices” by MNEs in Africa, which “result in a substantial erosion of a country’s tax base,” he commented that, although MNEs must also “take active steps to stop aggressive tax structuring practices, … there is a need to strengthen tax legislation…

Boston Scientific to pay $275 Mln to IRS to resolve disputes (Nasdaq)

Boston Scientific Corp. (BSX), in a filing with the US Securities And Exchange Commission on Tuesday, said it has entered into a Stipulation of Settled Issues with the Internal Revenue Service or IRS. This is intended to resolve all disputes related to the previously disclosed transfer pricing issues for Guidant Corp.’s 2001 through 2006 tax years and Boston Scientific’s 2006 and 2007 tax years currently before the United States Tax Court…

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