jueves, 2 de marzo de 2017

Key changes anticipated in transfer pricing administration in China

Since China’s 2009 issuance of Implementation Measures of Special Tax Adjustment (Trial) (Guoshuifa [2009] No.2 Circular, hereinafter referred to as the “Circular 2”) by the State Administration of Taxation (SAT), there have been profound developments in tax administration in many countries, including China.  Amidst the weak global economy, governments have been seeking a broader cooperation in tax administration, and the OECD and G20 governments have agreed on 15 Action Plans to address base erosion and profit shifting (BEPS).  The BEPS final reports published in 2015 set forth the foundation and objectives for cross-border tax rules.

In light of the background, the SAT undertook initiatives in 2016 to introduce major revisions to existing transfer pricing regulations, promulgating Public Notice on Matters Regarding Refining the Reporting of Related Party Transactions and Administration of Transfer Pricing Documentation (SAT Public Notice [2016] No. 42, hereinafter referred to as the “Public Notice 42”)1 on June 29, 2016, and Public Notice on Matters Regarding Enhancing the Administration of Advance Pricing Arrangements (SAT Public Notice [2016] No. 64, hereinafter referred to as the “Public Notice 64”)2 on October 11, 2016.

Based on our experience with companies involved in transfer pricing administration and investigation cases, PwC anticipates potential changes to China’s transfer pricing administration and investigation procedures.

Source & more info: PwC

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