Transfer Pricing Times - April 2019

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Executive Summary

In this edition of Transfer Pricing Times, we present the latest and most relevant transfer pricing issues and developments from around the globe.

In the “IRS, Amazon Dispute Over Definition of Intangibles May Have Significant Impact on Treatment of Pre-U.S. Tax Reform Cost Sharing Arrangements” article, we discuss the oral arguments made by the IRS and the taxpayer at the U.S. Court of Appeals for the Ninth Circuit on April 12, 2019. This case focuses on the value of intangibles transferred under Amazon’s cost sharing arrangement between its U.S. and Luxembourg entities.

In the “Digital Tax Update: U.S. Legislators React to Unilateral Digital Tax Proposals” article, we review the Digital Services Tax proposal passed by the French National Assembly on April 10, 2019 as well as U.S. government views on digital tax proposals arising in a number of jurisdictions in Europe.

In the “United Nations Issues Draft Guidance on Financial Transactions, Profit Splits and Risk Assessment” article, we explore the UN’s recently proposed draft chapter for its Practical Manual on Transfer Pricing for Developing Countries addressing Financial Transactions. 

In the “Australian Taxation Office Issues Draft Guidance on Thin Capitalization Arm’s Length Debt Test” article, we discuss the ATO’s preliminary views on the application of the arm’s length debt test contained in the thin capitalization rules enacted in 2001.

Finally, our “Updates for Hong Kong Country-by-Country Reporting Framework” article reviews the Inland Revenue Department of Hong Kong’s new Country-by-Country Reporting framework.

We hope that you will find this and future issues of Duff & Phelps’ monthly transfer pricing newsletter informative and reliable.