Latest Expert Exchange Queries

GST Demo Service software link:
Username: demouser Password: demopass
Get your inventory and invoicing software GST Ready from Binarysoft
sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing | GST - Goods and Services Tax
Popular Search: list of goods taxed at 4% :: ACCOUNTING STANDARD :: empanelment :: ARTICLES ON INPUT TAX CREDIT IN VAT :: form 3cd :: VAT Audit :: TAX RATES - GOODS TAXABLE @ 4% :: Central Excise rule to resale the machines to a new company :: articles on VAT and GST in India :: cpt :: due date for vat payment :: ACCOUNTING STANDARDS :: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes :: VAT RATES :: TDS
Customs and Excise »
 Central Board Of Excise & Customs New Delhi GST Flyers
 Hike in customs duty on electronics likely to boost revenue collection
 Customs duty raised on electronic goods
 Ministry Of Finance (Central Board Of Direct Taxes) Notification
 Refund of IGST paid on export of goods under rule 96 of CGST Rules,2017
 Customs And Central Excise Drawback – Part II
 Customs Valuation (Determination of Value of Imported Goods) Rules 2007
 Amendment to Customs Valuation Rules – Notification No. 91/2017 (NT)
 GST on Custom House Agents
 The Customs and Central Excise Duties Drawback Rules, 2017 and All Industry Rates (AIRs) of Drawback related changes
 The Customs and Central Excise Duties Drawback Rules, 2017

Improve Transfer Pricing, Customs Cooperation
March, 29th 2016

Joint audits and advance pricing agreements are ways that customs and tax officials could address the “divergence” of compliance obligations that multinationals can have for the same cross-border transactions, an international customs official said.

Multinationals have for at least a decade expressed concerns about competing obligations they face for the same cross-border transactions on goods made by related parties or associated enterprises when dealing with customs administrations and transfer pricing officials, said Liu Ping, director of the World Customs Organization's Tariff and Trade Affairs Directorate.

For a given transaction, customs agents aim to ensure all appropriate elements are included in the customs value of a good, while tax authorities want to make sure the transfer pricing doesn't include any inappropriate elements. While a lower customs value, and hence levy, is a preferable trade outcome for companies, a higher transfer pricing value is desirable to keep taxable profit down, he noted.

A February 2015 policy statement by the International Chamber of Commerce, a Paris-based business lobby, said a “dichotomy” of customs and transfer pricing rules set independently for the same transaction creates uncertainty, complexity, an increase in compliance costs and significant risk of penalties for business, both in developing and developed countries.

Commenting March 14 during the Bloomberg BNA-Baker & McKenzie Paris conference, Ping said that although there has been some “modest, limited progress” in recent years, there is still a need to “bridge the gap” between customs valuation and transfer pricing rules and procedures.

During a panel at the 2015 edition of the same conference, transfer pricing practitioners cited a trend among customs officials in emerging countries, particularly China, to apply their own interpretation of transfer pricing rules to goods entering at the border. These interpretations often conflict with those of corporate tax authorities in the same countries and could become a bigger risk in the context of two-sided transfer pricing methods.

The Organization for Economic Cooperation and Development's report on aligning transfer pricing outcomes with value creation, released in October 2015 as part of the international action plan against base erosion and profit shifting, said “customs valuation may be useful to tax administrations in evaluating the arms length character of a controlled transaction and vice versa.”

The report said greater cooperation between a country's tax and customs administration officials in evaluating transfer prices is becoming more common and should help reduce the number of cases in which customs valuations are found unacceptable for tax purposes, and vice versa.

Introducing Ping for his keynote address, Caroline Silberztein, a partner in Baker & McKenzie's Paris office, said she worked with him on the issue of customs valuations and transfer pricing while she was head of the OECD's transfer pricing unit. The OECD and the WCO have held several conferences on that topic in the past decade, including three regional workshops in 2013 and 2014.

The WCO published a guide to customs valuation and transfer pricing valuation in 2015.

One problem cited in that report is inconsistency in customs treatment of transfer pricing documentation, especially for post-importation adjustments. Ping said Australia, Canada, the U.S. and the U.K. recently issued guidance on price adjustment. “That's good news to business, in that those guidelines would advocate acceptance of both upward and downward adjustments for customs valuation purposes,” he said.

Because a large part of the problem is lack of communication between tax and customs authorities, a recommendation is to boost information exchange, Ping said. Some developing countries, such as Fiji, have merged their tax and customs authorities, and have seen some benefits from doing so. In Chile, meanwhile, tax officials consult customs authorities before they issue an advance pricing agreement.

With some authorities complaining of a “lack of reciprocity” from their colleagues in other agencies, more needs to be done to improve cooperation, said Ping, noting that customs and tax departments within companies themselves sometimes don't communicate. “Lack of cooperation hurts business,” he said.

Silberztein said “the prospect of including some of the BEPS concepts in customs valuations can be a bit scary for the business community. But on the other hand, the possibility to obtain a downward customs adjustment when we have a transfer pricing adjustment, for instance, on an important price or the possibility of a joint customs-transfer pricing APA is probably a very welcome development.”

Home | About Us | Terms and Conditions | Contact Us
Copyright 2018 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Binarysoft Technologies - Achievements

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions