Analysis On Disputes Resolution Of Transfer Pricing

The cross border transfer pricing owing to global double taxation shall on onehand affect the flow of commodity, capital, technique and people and adverselyinfluence international economic and trade activities, while increase taxpayer’soverall burden on the other, which in fact infringe taxpayer’s interest. Therefore,international community and governments of different states take measures to seekeffective channel to dissolve global double taxation by coordinating unilaterally,bilaterally or multilaterally. Current approaches include: mutual negotiationprocedures, statutory taxation arbitration procedure and advanced pricing agreementregime. While under mutual negotiation procedures, nations’ interest are realized themost, the taxpayer under such scheme are, nevertheless, put in a subordinated positionand behave negatively. From the perspective of preserving taxpayer’s right, statutorytaxation arbitration procedure and advanced pricing agreement do deserve more studyon.In the last few years, the research on statutory taxation arbitration procedure inthe academic circle are mainly based on Article25of Taxation Agreement Templateissued by OECD and much study and analysis has been carried out on the proceduralrules. Though many scholars noticed that statutory taxation arbitration procedure are also stipulated in Convention on the Elimination of Double Taxation in Connectionwith the Adjustment of Profits of Associated Enterprises by European Union, severalof them do focus on the differences regarding the provision design and proceduralrules of statutory taxation arbitration procedure under Convention and TaxationAgreement Template, nor do they articulate on such issues. Meanwhile, few scholarsanalyze independently on the practice of statutory taxation arbitration procedure.Additionally, as for advanced pricing agreement procedure, the study on thetheory and practice of such scheme gradually commenced from the end of nineteennineties last century. In the realm of economics, scholars are bound up in focusingmore on how to reasonably ascertain transfer pricing approaches, conductcomparability analysis, set key assumption and so forth. In legal field, proceduralpractice on advanced pricing agreement is more emphasized on.The author hereof chooses statutory taxation arbitration procedure and advancedpricing agreement regime as study subject, which mainly keep a watchful eye ondifferent specific procedural design under statutory taxation arbitration procedure andadvanced pricing agreement regime and shall provide favorable reference for ourstate.Article One gives general ideas on global transfer pricing dispute. Initially, therelevant conceptions of transfer pricing and also the relationship between transferpricing and basic principles of taxation law is analyzed, then the reason for transferpricing dispute and the resolution carried out by states on which are discussed.Article Two further analyze on statutory taxation arbitration procedure. First thehistorical origin, applicable scope and procedural rules of Convention on theElimination of Double Taxation in Connection with the Adjustment of Profits ofAssociated Enterprises by European Union is introduced; after which the differencebetween Convention on the Elimination of Double Taxation in Connection with theAdjustment of Profits of Associated Enterprises by European Union and TaxationAgreement Template is analyzed in comparison; finally, the global practice ofstatutory taxation arbitration procedure so far is studied. Article Three studied on advanced pricing agreement regime synthetically in themanner of comparative analysis. Relevant conceptions and categorizations underadvanced pricing agreement scheme are firstly defined; by analyzing the procedure ofadvanced pricing agreement regime U.S. and other states, and coupled with itspractice, the advantages and existing matters of advanced pricing agreement arestudied.Article Four studied on the development of statutory arbitration procedure andadvanced pricing agreement regime in our state. At the beginning, through analyzingthe legislation and practice of advanced pricing agreement regime in our state, theexisting matters in its development are articulated herein; in addition, feasibility studyon the introduction of statutory taxation arbitration procedure by our state areconducted, to which specific suggestions are provided thereof.In the course of writing, this thesis employs Archival Research Method,Empirical Analysis Method, Qualitative Analysis Method and Comparison andSummarization Analysis Method. The defects of this thesis are: focus on discussingstatutory taxation arbitration procedure and advanced pricing agreement regimeseparately, left the correlation between which inadequately tapped.The innovations of this thesis are: firstly, analyzed on the statutory taxationarbitration provisions under Convention on the Elimination of Double Taxation inConnection with the Adjustment of Profits of Associated Enterprises by EuropeanUnion ingeniously and compare the difference between it and the Taxation AgreementTemplate; and second, summarized the practice of statutory taxation arbitrationprocedure.