Rules on Intangible Sales – The Real Problem with the Arm’s Length Principle
Journal
Country
International; OECD
Published Date
Issue
Bulletin for International Taxation 2024 (Volume 78), No. 5
Document
Profit shifting appears to be driven by underpriced group intangible sales to low-taxed affiliates derived from valuations resulting from income allocation methods. The enforcement of the periodic adjustment of the intangible price cannot definitively avoid this problem, but could (partly) avoid sales in breach of the arm’s length principle.