International It Enterprises Transfer Pricing To Avoid The Problem Of Import Tariff

Under the background of global economic integration,the international enterprises have a great influence on the development of the whole world economy by virtue of its own advantages.After China joined in WTO,Chinese market has gradually increased the degree of opening to the outside world and many of international IT companies have also begun to pour into the Chinese market.At the same time,in order to maximize profits of the company,some of the companies took method of investment abroad to avoid paying taxes.As the practical way of avoiding tax,transfer pricing has been more and more popular to be taken by international companies.On the other hand,the government has not figured out the effective way to deal with this issue.Actually,Chinese government has started to focus on this area and attached more importance on tax policies,like the big event of adjusting the import tax policies at the beginning of 2016,Under such circumstance,the study on the transfer pricing became more meaningful.Firstly,this paper expounds the concept of the transfer pricing of international enterprises and analyzes the tax incentives and non tax motives of the transfer pricing.Taking Hewlett-Packard Co as an example,this paper gives deep analysis on how the international enterprises avoid import tariffs through the transfer pricing.This paper briefly introduces the structure and key organizations of Hewlett-Packard Co in China,explains the transactions between affiliated companies,analyzes the method of transfer pricing of Hewlett-Packard Co with the reasonable transfer pricing.Combined with the specific case on how Hewlett-Packard Co realized transfer pricing in China,this paper outlines the transfer pricing regulations which constitute the international enterprise system,elborates the current supervision policies of Chinese government on transfer pricing of international enterprises,clearly points out that the new progress of transfer pricing management for Chinese government,also shows the limitations of transfer pricing from internal and external wise during the process of implementation.Based on the current status,this paper puts forward to suggestions of improving the tax policy and system for transfer pricing as below: further improve our existing transfer pricing tax system;actively establish tax information network,strengthen international tax cooperation;establish efficient supervision team,strengthen the supervision of the transfer pricing;establish a sound anti to avoid the import tariff mechanism,enhance the anti circumvention tariff coordination;gradullay realize the centralized and unified management of import tariff work and increase the investment of funds based on actual need.