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Transfer pricing and developing economies : a handbook for policy makers and practitioners (English)

Recent years have seen unprecedented public scrutiny over the tax practices of multinational enterprise (MNE) groups. Tax policy and administration concerning international transactions, aggressive tax planning, and tax avoidance have become an issue of extensive national and international debate in developed and developing economies alike. In this context, transfer pricing, historically a subject of limited specialist interest, has attained name recognition among a broader global audience that is concerned with equitable fiscal policy and sustainable development. This handbook therefore starts out by providing a high-level summary of issues to consider, including guidance on analytical steps that should be taken at the outset to understand a country’s potential exposure to inappropriate transfer pricing, or rather Transfer Mispricing. The handbook is structured as follows: (i) The first chapter provides a general overview on transfer pricing and the global policy debate; (ii) In the second chapter, the authors consider a broad range of aspects in countries’ international legal framework relevant for transfer pricing; (iii) The third chapter provides practical guidance on drafting transfer pricing legislation for direct taxation purposes based on the arm’s-length principle; (iv) The practical application of the arm’s length principle (comparability, transfer pricing methods, and the arm’s length range concept) is presented in chapter four; (v) Chapter five has the discussion of selected issues for specific transaction types or situations; (vi) Promoting compliance among taxpayers through effective communication and outreach campaigns, and requirements to disclose and document transfer pricing-related information, is the focus of chapter six; (vii) In chapter seven, different components of a successful dispute avoidance and resolution strategy are discussed; and (viii) Finally, chapter eight discusses the necessary components to develop, implement, and continuously update an effective transfer pricing audit program.

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Cooper,Joel Lachlan Fox,Randall R Loeprick,Jan Mohindra,Komal

Transfer pricing and developing economies : a handbook for policy makers and practitioners (English). Directions in development Washington, D.C. : World Bank Group.