Latest Expert Exchange Queries
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) | Service Tax | Sales Tax | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Indirect Tax | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing
 
 
 
 
Popular Search: due date for vat payment :: TAX RATES - GOODS TAXABLE @ 4% :: empanelment :: ACCOUNTING STANDARDS :: VAT Audit :: form 3cd :: cpt :: Central Excise rule to resale the machines to a new company :: list of goods taxed at 4% :: VAT RATES :: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes :: ARTICLES ON INPUT TAX CREDIT IN VAT :: articles on VAT and GST in India :: ACCOUNTING STANDARD :: TDS
 
 
« Transfer Pricing »
 Secondary adjustments to become a reality under Indian transfer pricing regime
  Budget introduces secondary adjustments in transfer pricing
 Transfer pricing: Centre moves forward, introduces ‘secondary adjustments’
 Domestic transfer pricing leeway provides a loophole for Indian companies
 Budget introduces secondary adjustments in transfer pricing
 Transfer Pricing Rules – 2017 novelties
 OECD BEPS transfer pricing rules likely to cost multinationals, but not the IRS
 Transfer pricing’ offers lots of room for manipulating international payments
 New rules for transfer pricing
 Updated UN manual reveals India’s transfer pricing positions
 Budget 2017: What Clarity Can It Bring To International Taxation And Transfer Pricing?

FDI from tax havens raises concerns about transfer pricing
June, 06th 2016

Experts have warned that foreign invested enterprises (FIEs) from tax havens may be conducting transfer pricing, and have urged state management agencies to investigate enterprises with ‘abnormal signs’.

Enterprises, through contracts on goods supply signed with legal entities in tax havens, could wrongly declare production costs higher than the real costs. This allows them to reduce the tax they have to pay in Vietnam.

Meanwhile, the real profit goes to the pocket of their holding companies in tax havens, where they don’t have to pay tax or only pay low tax thanks to preferential tax policies applied in countries.

Nguyen Van Toan, deputy chair of the Foreign Invested Enterprises’ Association, warned that if foreign investors from tax havens deliberately dodge the laws and conduct transfer pricing, this will have serious impact on Vietnam’s economy.

Toan said it was necessary for state management agencies to check all the foreign invested projects, no matter where they are from, to find out what projects have stopped operation, gone bankrupt or have been sold, so as to set up reasonable solutions.

Enterprises, through contracts on goods supply signed with legal entities in tax havens, could wrongly declare production costs higher than the real costs. This allows them to reduce the tax they have to pay in Vietnam.
Do Thien Anh Tuan, a lecturer of the Fulbright Economics Teaching Program (FETP), said that based on Vietnamese laws, Vietnam can only consider inter-border transactions made by the people listed in the Panama Papers, including transactions on services, goods and currencies, to find out if the transactions were declared in a transparent way as demanded by the law.

Vietnam also can check if the investments observe regulations on licensing and go within the permitted fields, and if there were business activities or transactions of goods and services with overseas entities.

One of the typical characteristics of the businesses set up in tax havens to avoid tax is that they don’t carry out any production and business activities. The investors only register legal entities to serve their tricks of avoiding tax.

Tuan said in order to find out if the individuals listed in the Panama Papers committed dubious acts, it is necessary to define their taxable income in Vietnam before they transfer money to tax havens.

Tuan noted that in the BOP (balance of payments) shown on the State Bank of Vietnam’s website, the ‘errors and omissions’ column usually shows high figures.

“This shows that a big volume of foreign currencies go abroad without declaration which is not taken into account in BOP,” Tuan said.

 
 
Home | About Us | Terms and Conditions | Contact Us
Copyright 2017 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
E-catalogue online catalogue E-brochure online brochure online product catalogue online product catalogue e-catalogue Indi

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