On The Tax Avoidance In The International Legal Regulation Of Transfer Pricing

With economic globalization continue to strengthen in international economic activity, multinational corporations use loopholes in national tax differences and the phenomenon of international tax avoidance more and more serious, which, given the ease of transfer pricing, hidden, has become a transnational Companies generally adopted the most important means of international tax avoidance, and the trend of increasing diversity in our country, this issue is becoming increasingly prominent.Multinational companies use transfer pricing to achieve the most optimal and effective internal configuration means. Usually the major multinational companies to take the following approach to achieve the purpose of tax avoidance:Tangible and intangible property transactions, transfer of tangible property, the right to use, adjust the cost sharing and so on. Transfer pricing behavior of these had an impact on the normal market order, endanger national tax sovereignty, violation of the legitimate interests of other market players, undermine the international tax system。Governments, the tax authorities have concerned about the use of transfer pricing to evade tax situation. The international community has formed the core of OECD and the United States as the core system of the two transfer pricing system. Based on the principle of fairness in taxation and tax efficiency established the basic legal principles of transfer pricing, including the Arms Length principle, the principle of total profits and optimization principles. And regulate the basic adjustment mode: the comparable uncontrolled price model, the resale price model, cost-plus model, transactional net margin method and profit split method. Then provides for pre-adjustment model - advance pricing mechanism.China first introduced the transfer pricing issues in 1986, has developed a series of transfer pricing laws and regulations. Because legislation late start, China's transfer pricing system, there are still basic system, lack of maneuverability, the punishment mechanism for deletion and the absence of specific management procedures and other issues. To solve these problems, should further improve the advance pricing mechanism, improve the basic institutional system, improve the tax administration system, establish penalties and strengthen international cooperation mechanisms.