The Indian Central Board of Direct Taxes (CBDT) has changed the selection criteria for auditing transfer prices, with a focus on risk parameters, rather than automatically selecting transactions over a certain value.
The European Commission (EC) has ruled that Starbucks and Fiat have acted illegally in their tax agreements with Netherlands and Luxembourg and will need to pay back to the respective governments between €20 million ($23 million) and €30 million each.
The final BEPS release on October 6 meant the conclusion of the two-year project on changing guidelines for international taxation. Despite this, it was confirmed that some topics will remain open to further discussion including permanent establishment (PE), which has proved difficult to redefine.
The final BEPS guidance is lacking in some areas, including recommendations about the application of the profit split method, which is being increasingly accepted by tax authorities.
The Bombay High Court has rejected the Income Tax Appellate Tribunal’s (ITAT) order to apply a transfer pricing adjustment to Vodafone for the sale of a call centre in India.
There has been widespread international reaction to the OECD’s release of its final BEPS package. While many of the measures are welcomed by practitioners, transfer pricing is the biggest uncertainty.
