The Organisation for Economic Cooperation and Development (OECD) announced that the “Platform for Collaboration on Tax” (a joint initiative of the IMF, OECD, UN and World Bank) is seeking feedback on a draft toolkit designed to help developing countries in the implementation of effective transfer pricing documentation requirements.
As the OECD release stated:
…transfer pricing documentation is necessary for effective implementation of transfer pricing rules. The requirement to maintain and furnish documentation encourages compliance and assists tax authorities with accessing information necessary to enforce transfer pricing regulations. It also allows tax administrations to focus efforts and to deploy limited resources on taxpayers and transactions that pose most significant risk of tax loss. However, comprehensive documentation can be costly for the taxpayer; therefore, it is important to find the right balance between the tax authorities' needs and avoiding excessive compliance costs.
The draft toolkit:
Comments are requested on the draft toolkit, and are requested by 8 November 2019.
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