Transfer pricing documentation – an efficient measure for combating the base erosion and profit shifting?
Author:
Liliana FELEAGĂ, Ioana NEACȘU
JEL:
M40
DOI:
10.20869/AUFFIN/2016/134/183
Keywords:
transfer pricing, arm’s length principle,
affiliation relationships, double taxation of results,
manipulation of results, transfer pricing documentation
Abstract:
The setting up of groups of companies has become a
large scale phenomenon, dominating the global
economy. These groups have set up subsidiaries in
different countries, leading to the occurrence of issues
regarding the taxation of the results within the group,
and to the development of the transfer pricing concept,
respectively. This concept has been used over the time
by multinational corporations to move their profits in low-
tax jurisdictions. For this reason, globally, there have
been concerns regarding the adoption of a legislation
that could combat the base erosion and profit shifting.
This article analyses whether the adoption of a
legislation which provides the transfer pricing
documentation requirement represents an efficient
measure for the blurring of the base erosion and profit
shifting phenomenon. The research was performed at
the level of the member countries of the Organisation for
Economic Co-operation and Development. The article
also aims to clarify certain aspects regarding transfer
pricing and to provide a practical approach of the
associated mechanisms. The novelty, originality and
impact of the article on the accounting profession are
represented by the fact that the transfer pricing concept
is relatively new for the specialists from Romania and
also for the tax authorities.
Abstract(87KB)
Article(328KB)