Global

Details

  • Service: Tax, Global Transfer Pricing Services, Global Compliance Management Services, International Tax
  • Type: Regulatory update
  • Date: 5/24/2013

Asia Pacific - Brief report on recent transfer pricing developments 

May 24:  Governments and tax authorities in some Asia Pacific countries have been more aggressive in focusing on transfer pricing activities and tax decisions by corporations.

This brief report looks at the status of transfer pricing changes and provides updates on recent transfer pricing developments in Australia, Japan, India, Korea, and Thailand.


  • Australia - The Australian Tax Office will potentially pursue selective audit activity focusing on low tax jurisdiction transactions, financial transactions, and business restructuring.
  • Japan - Recent transfer pricing-related developments include (1) repeal of the hierarchy among transfer pricing methods; (2) introduction of the arm’s length “range” concept and Berry ratio; and (3) restriction on the use of secret comparables.
  • India - The new advance pricing arrangement (APA) program (effective 1 July 2012) may help reduce certain challenges that corporations face in dealing with related parties (associated enterprises).
  • Korea - The recent transfer pricing developments include (1) harmonization of transfer pricing adjustments with corporate tax and customs duty obligations; (2) the ability to determine an arm’s length price for intercompany guarantees; and (3) the tax authorities may potentially further strengthen the APA team and the international tax audit teams with a focus on transfer pricing-related tax issues.
  • Thailand - Current law does not afford an opportunity to resolve certain transfer pricing issues using APAs because of the absence of rollback adjustments for prior years. The government may want to consider amending the tax laws, to regulate transfer pricing, to introduce annual reporting on intercompany transactions, and to allow for pre-assessment agreement procedures.


For more information, contact a transfer pricing professional with KPMG’s Global Transfer Pricing Services practice in Australia:


Tony Gorgas

+61 2 9335 8851



Or contact a tax professional with KPMG's Global Transfer Pricing Services.




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