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Study On Evading Taxation With Transfer Pricing In Multinational Affiliated Enterprises

Posted on:2007-10-15Degree:MasterType:Thesis
Country:ChinaCandidate:B ZhuFull Text:PDF
GTID:2166360185990952Subject:International Law
Abstract/Summary:PDF Full Text Request
After the reform and the opening , more and more Multinational Corporations have invested in China. Thus the problem becomes progressively marked that the Foreign-investment Enterprises utilize the method of transferring the transaction price to evade the taxation. The action of Transfer Pricing results in profound influences on the politics and economics. In order to well protect the national income in the globalization of the world economic , Transfer Pricing must be forbidden. It is the national revenue dominion to make adjustment to the transaction price according to the Arm's Length Principle. Transfer-Pricing contravenes the Arm's Length Principle. In fact it evades one country's tax by replacing the reasonable price with transferred price. So no matter what the purpose of the Price-transferring is for, saving or omitting the tax or not, if only it inroads the tax revenue of the nation, the government has the power to regulate it.There are some subjective and objective causations for affiliated enterprises to transfer the transaction price. Some of the subjective causations are for evading taxation and some are not. It gives the affiliated enterprises the chance to evade the national taxation because of the revenue jurisdiction of different countries, the difference tax rates, the different method in avoiding reiteration in national taxation, the existence of the Tax Heaven and the shortage of co-operations in international taxation management. Presently the principle which is mostly adopted in the world is the Arm's Length Principle, it's emphasis is to study the comparableness of between the transactions. China also adopts the Arm's Length Principle. But there are still some limitations in the using of the Principle, such as indefinite and Ex post facto. In years of 90, there comes the system of Advance Pricing Arrangement which is getting the attention of more and more countries.Besides the commonness in the Transfer-Pricing between the Chinese enterprises...
Keywords/Search Tags:international avoidance of revenue, multinational affiliated enterprise, transfer-pricing, the arm's length principle
PDF Full Text Request
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