New report tells governments to abandon arm’s length price
June 24, 2009
Governments should abandon the arm’s-length price and grant multinationals the discretion to set their own transfer prices internally, says a report from the Rotman School of Management at the University of Toronto.
The report, entitled Gray Markets and Multinational Transfer Pricing, explains that, despite generating extra tax revenues for tax authorities, the arm’s-length price encourages multinationals to seek low tax jurisdictions as locations to do business.
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