Reuters: Regulatory News: Ireland boosting capacity to track transfer pricing

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Ireland boosting capacity to track transfer pricing May 29th 2013, 13:13 DUBLIN | Wed May 29, 2013 9:13am EDT DUBLIN May 29 (Reuters) - Ireland is increasing its capacity to track how multinationals shift resources around the world using transfer pricing amid criticism about the country's role in tax avoidance. Days after a U.S. Senate committee said Apple funnelled tens of billions of dollars of profit through Ireland to avoid taxes, the tax office said it was looking to boost the number of company databases it uses to monitor transfer pricing. It also advertised for new staff to raise its capacity in several areas, including transfer pricing. Transfer pricing, by which multinationals control the value at which products, services or assets are traded between units across borders, can be used to shift income between jurisdictions and is sometimes used by firms to minimise their tax exposure. Asked if the measures were related to charges by U.S. lawmakers that Ireland was a tax haven for Apple, allowing it to pay an effective tax rate of less than 2 percent, a spokeswoman for the Irish tax service declined to comment on Wednesday. She pointed instead to an increase in workload related to tax submissions under new transfer pricing laws. A 2010 law brought Ireland into line with most of its trading partners by introducing a formal regime requiring companies' intra-group transfer prices to be similar to those that would be charged to independent entities. The first deadline for corporate tax submissions under the new rules was September 2012. Arrangements already in place when the law was passed were exempt and lawyers have said the new rules said were unlikely to cause significant problems for multinational firms. The government has said that it cannot be held responsible for the amount of tax Apple pays globally and that action to curb aggressive tax planning should be taken by international organisations rather than at a national level. Link this Share this Digg this Email Reprints

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