Global Tax Adviser, September 29, 2015. David Francescucci, GTA, KPMG LLP, China released a discussion draft of proposed guidance intended to clarify China's approach to transfer pricing investigations and analysis for public consultation on September 17, 2015. The guidance, which is expected to be finalized by the end of 2015 and to go into effect in 2016, introduces new transfer pricing methodologies and significantly expands transfer pricing documentation requirements.
The discussion draft encompasses a range of source materials including existing transfer pricing guidance, as well as items emerging from proposals in the OECD's base erosion and profit shifting (BEPS) Action Plan. The draft also reflects the evolution of the transfer pricing enforcement approach of China's tax authorities.
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