Transfer Pricing in a World Recovering from COVID: Juggling Compliance with New Global Tax Policies
Keywords:
Transfer pricing, COVID-19, OECD, global tax regimesAbstract
The COVID-19 epidemic damaged world economies, so multinational companies had to navigate challenging transfer pricing policies while following fast changing tax laws. As supplier networks altered and profit margins evolved to reflect the new reality, tax authorities all around started attentively reviewing conventional transfer pricing rules. The epidemic sped up debates over equitable profit distribution as new international frameworks like the OECD's Unified Approach acquired traction—especially for enterprises in the digital economy. Multinational corporations today suffer increased risks of conflicts as governments handle economic crises and strengthen enforcement laws.Transfer pricing policies in this environment have to go beyond mere compliance to include proactive stakeholder involvement, real-time data analysis, and thorough documentation. Companies responding to pandemic-induced disruptions—which include market instability and changes in supply-demand dynamics—must rethink intercompany transactions, intangible asset pricing, and the arm's length principle.This study looks at how companies could balance their need to comply with their adaption to new worldwide tax systems. It emphasizes the importance of employing current technology for tax reporting, such as risk management systems, and encourages cooperation with tax authorities to reduce conflicts. Moreover, it examines case studies of sectors notably affected by the epidemic—more especially, drugs and technology—to offer practical solutions for control of transfer pricing in a post-COVID world. Using a proactive and flexible approach will help businesses ensure compliance and build resilience among ongoing changes in regulations and economic uncertainty.
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