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Arcotia Hatsidimitris - International Tax Dialogue

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48 – 5. MAINTAINING PROGRESS, TACKLING DELAY<br />

advisors knew what to expect from the tax administration and publication could help demonstrate<br />

consistency of approach and therefore support actions taken by the tax administration. <strong>Tax</strong><br />

administrations, business and their advisors noted that where guidance is published it can be very<br />

helpful, both to business and the tax administration, to consult with external stakeholders whilst the<br />

guidance is still in draft so that issues or concerns can be addressed by the tax administration before<br />

the guidance is finalised, usually leading to a much better product.<br />

Deliberate obstruction<br />

Most tax administrations recognise the need to regularly reassess the scope of their audits and<br />

enquiries to ensure that they remain relevant. In a similar way they need to ensure the reasonableness<br />

of their requests, particularly where they set tight deadlines. However, sometimes despite all efforts to<br />

do this and engage with a business, tax administrations can be faced with outright opposition to their<br />

attempts to undertake an audit or enquiry. Where this happens they need to have ready strategies that<br />

can be deployed to counter such obstruction; for many tax administrations this can involve the use of<br />

information powers, the ability to estimate assessments and to close cases using legal processes.<br />

Having the ability to use all of the means of tackling delay outlined in this chapter should, however,<br />

mean that these are only strategies of last resort and seldom need to be used.<br />

Key thoughts for chapter<br />

Most tax administrations have experience of transfer pricing audits or enquiries that run for many<br />

years. Often the cause of delay lies in the fact intensive nature of transfer pricing work and<br />

disagreements over the provision of business records. Early discussion about the aspects of the<br />

business to be reviewed, carefully focused requests for records and agreed timetabling can ensure a<br />

speedy and effective outcome to audits or enquiries. The development of alternative dispute resolution<br />

techniques in several countries suggest that this approach may be of use in transfer pricing cases.<br />

DEALING EFFECTIVELY WITH THE CHALLENGES OF TRANSFER PRICING © OECD 2012

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