MNE benefit RBMbm

Proposal for a Global Taxation System

 – DAGTVA truth table –

DAGTVA® – Distribution of MNE profits

No. Problems exposed, requests, constraints and subjects Origin Pg Li Doc
55 Mt B – Dissatisfaction with the current transfer pricing rules. Pillar 1 9 26 RBMbm

Quote2.4. New and revised profit allocation rules (RBRge)

30. Against that background, the “Unified Approach” proposes the following three tier mechanism:

Amount B – Activities in market jurisdictions, and in particular distribution functions, would remain taxable (RBMbf) according to existing rules (e.g. transfer pricing under the arm’s length principle and permanent establishment allocation under Article 7) (RBMbp). However, given the large number of tax disputes related to distribution functions, the possibility of using fixed remunerations would be explored (RBMboRBMbr), reflecting an assumed baseline activity. Appropriate and negotiated fixed returns could provide certainty to both taxpayers and tax administrations, and reduce the dissatisfaction with the current transfer pricing rules (RBMbm).

With the DAGTVA calculation of transfer prices , both tax authorities and taxpayers would know the rules of the game in terms of transfer pricing, direct and indirect taxation. A guarantee of transparency which would restore fairness in what should be taxed on cross-border transactions.

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