Research On The Transfer Pricing Method Of Multinational Corporations Invested In China

With the deepening of economic globalization,the division of labor in the global value chain has gradually formed.Multinational corporations are increasingly placing different links in the design,development,production,marketing and after-sales services of different countries in different countries and regions.The role played by multinational corporations in the internal management process has become more prominent.In addition,a large number of multinational companies have also transferred the profits generated by the companies in the conglomerate to low-tax countries such as tax havens,through careful transfer pricing tax planning,which has caused serious erosion of corporate income tax bases.Since the revenues of developing countries are more dependent on the creation of multinational corporations,the tax avoidance of those companies has a greater impact on the income of developing countries.So far,China is still the largest foreign-invested country among developing countries.Under the new series of investment facilitation and investment promotion measures released this year,the FDI flowing into China is expected to remain at a high level.The tax revenue brought by multinational corporations invested to China still occupies an important position in China's fiscal revenue.Many multinational companies in China claim long-term losses.In fact,most of them have used transfer pricing and other measures to carry out hidden profit transfer.As currently China is lacking of strong and effective transfer pricing tax system and management measures,it is difficult to manage and investigate this kind of phenomenon effectively.The situation needs to be improved.This paper mainly studies the different transfer pricing methods implemented by multinational corporations invested in China,and selects the main characteristics of typical case to analyze.According to the relevant data of multinational corporations' investment in China,it analyzes the possible transfer pricing tax avoidance doubts;then summarizes China's transfer pricing.Based on the relevant practices of the United States,Japan and the OECD,the paper puts forward corresponding suggestions on the construction of China's transfer pricing tax system and the improvement of management measures: standardizing the system and method of transfer pricing tax management,and improving China's domestic Tax management system,strengthening the construction of anti-tax avoidance experts,establishing taxation,business and customs coordination mechanisms,strengthening corporate social responsibility and integrity evaluation system,and improving transfer pricing tax management information construction,etc.,with a view to plugging tax loopholes and to create a healthy market environment,attract and utilize foreign capital better,and promote the sound development of the economic situation.