Dear subscribers of TP Week,
Together with you TP Week has witnessed the snowballing of transfer pricing legislation and BEPS measures across the globe. You may be a tax officer for a national tax authority, an adviser, a transfer pricing consultant, a corporate in-house counsel or a tax director, but what we all have in common is trying to keep up with the rapid changes in compliance and documentation requirements.
We’re proud to say that TP Week, since its inception in 2007, has tracked the growing importance of tax and transfer pricing. Over the past 10 years we have spoken to tax transparency advocates, the OECD, policy makers, lobbyists, tax enforcers and the business community about their concerns and aspirations.
To celebrate this achievement, we would like to invite you to take a trip back in time with us.
Today, large taxpayers, from your favourite high-street coffee shop to your cell phone developer, are hitting the headlines in mainstream media for paying or dodging mammoth tax bills. But there was a time when transfer pricing news were few and hard to come by and when advance pricing agreements and country-by country reporting were a distant reality.
We are sharing with you our selection of 10 TP Week articles that illustrate some of the most important transfer pricing developments over the past 10 years.
Only a year ago, the moment few thought possible finally arrived when Donald Trump was sworn into office as president of the United States, and businesses started looking at what Trump’s tax and transfer pricing policies could mean for them.
The UK’s bitterly contested Brexit referendum divided the population and government. Multinationals were urged to immediately consider tax and transfer pricing implications, including the possible absence of the Parent Subsidiary Directive and in particular the imposition of withholding tax on dividends.
For the first time representatives from civil society were invited to the EU Joint Transfer Pricing Forum.
Jean-Claude Juncker was the new – and controversial – President of the European Commission. Having previously stood as the prime minister of Luxembourg and also the finance minister for 20 years, until 2009, Juncker facilitated a tax system that has become synonymous with tax avoidance in Europe.
In a public consultation on transfer pricing matters in Paris, the OECD questioned the realities of implementing country-by-country reporting, with business’s main concerns centring on confidentiality.
Starbucks said it would review its corporate tax position in the UK after a damning report by the parliamentary Public Accounts Committee and the prospect of a boycott of its stores on December 8 2012. But bowing to political or public pressure is not the right way to conduct business.
Taxpayers were finding it more difficult to comply with the growing amount of transfer pricing documentation requirements. Jeffrey Owens listed the global challenges that tax policymakers face, including the shift from bricks and mortar to a service economy, the growing importance of intangible assets and the increasing reliance on BRIC countries to generate global economic growth.
The OECD approved updates to the Transfer Pricing Guidelines in its first major revision since they were released in 1995. In this update, the OECD clarified that the instances when a transaction can be disregarded are ‘exceptional’, defined as ‘rare or unusual’.
The economic crisis meant tax authorities were conducting more audits to boost revenues. More companies were challenging adjustments, leading to a rise in controversy and the emergence of advance pricing agreements.
The burden of keeping up with transfer pricing documentation requirements was starting to become one of the biggest challenges for multinational corporations, with some taxpayers having to prepare upwards of 500 transfer pricing reports a year.
In its first poll of senior tax directors, transfer pricing directors and advisers, TP Week revealed its definitive list.