Why are the Olympic Games and Transfer Pricing Similar ?
We all recovering from the Rio 2016 Olympic Games fever and coping with ‘the Olympic blues’ by following another sportive event or anxiously waiting for the next four years to go by and see our world athletes in Tokyo 2020.
If you are an Olympic Games’ fan, you will agree with us that transfer pricing and tax have been in an Olympic Games’ marathon since the OECD announced the initiation of BEPS Action Plan in 2013. The marathon partially finished with the announcement of BEPS Action Plan’s final reports in 2015, but the ‘Olympic blues’ are still impacting all areas of transfer pricing and tax with the implementation of the final reports by countries around the wold.
As any Olympic Games competition, we thought we should award our gold, silver and bronze medal to the BEPS Action Plan Olympic Marathon.
Gold: To all the countries that have implemented ‘Action 13 Transfer Pricing Documentation and Country by Country Reporting’.
Since the OECD released the final reports, less than a year ago, more than 30 countries have either announce implementation or release final or draft legislation to implement Action 13.
Silver: To the OECD that issue final reports of the BEPS Action Plan in 2 years.
The OECD implemented the changes to the transfer pricing guidelines recently changing Chapter I ‘Arm’s Length Principle’, Chapter II ‘Transfer Pricing Methods, Chapter V ‘Documentation’, Chapter VII ‘Intra- Group Services.'
Bronze: To Tax Authorities committed to tackling Tax Avoidance.
The ATO has been one of the leading tax authorities taking steps to tax avoidance. In Early August the ATO issued 136 letters to Multinationals to review their arrangements under Australia’s anti-avoidance legislation ato-issues-warning-letters-to-136-multinationals-under-new-multinational-antiavoidance-law.
Other tax authorities in the region are following the ATO example, and we can expect this trend to keep going around the world.