3. Electronic Theses and Dissertations (ETDs) - All submissions

Permanent URI for this communityhttps://wiredspace.wits.ac.za/handle/10539/45

Browse

Has files: YesSubject: search.filters.subject.Transfer pricing

Search Results

Now showing 1 - 6 of 6
  • No Thumbnail Available
    Item
    Base erosion and profit shifting in South Africa: A critical analysis of the effectiveness of the transfer pricing rules with regard to the elimination of profit shifting
    (2017) Mpanza, Xolani
    Tax base erosion and profit shifting (BEPS) is a key tax issue both locally and internationally. Multinational corporations are constantly trying to find means of reducing the amount of taxation that is payable by identifying gaps in tax laws. The aim is to lower the taxation that the group would be liable for. This study will analyse the developments of tax base erosion and profit shifting. There will also be an examination and comparison of South African transfer pricing laws with other countries' tax laws (United State of America, United Kingdom, Australia and Nigeria), specifically with regards to discouraging profit shifting in order not to obtain a tax advantage. Section 31 of the Income Tax Act 58 of 1962, is one of the tools that is currently being utilised by South Africa in addressing the issue of profit shifting. An analysis of Section 31 will be undertaken and it will be necessary to consider whether there are any loopholes or vagueness in the tax laws that may result in taxpayers manipulating the interpretation of the law in order to obtain a tax advantage. Profit shifting is a global problem that has left many countries deliberating on what could be an ideal solution. This study will also propose recommendations that might be used by Commissioner for the South African Revenue Service.
  • No Thumbnail Available
    Item
    Transfer Pricing Documentation in a Post-BEPS environment : a study of the evolution of transfer pricing documentation in South Africa and its alignment with the global standard
    (2019) Sukhlal, Limahl
    n terms of the South African Income Tax Act 58 of 1962 (“the Act”), the South African Revenue Service (“SARS”) has the power to make transfer pricing adjustments. This arises when SARS deems that Multinational Entities (“MNE”) have been transacting at prices which do not reflect prices expected to be charged if parties to the transaction were independent persons dealing at arm’s-length. By having the ability to make transfer pricing adjustments, SARS can minimise the effects of Base Erosion and Profit Shifting (“BEPS”).1 BEPS refers to tax planning strategies that shift profits from high tax jurisdictions like South Africa to locations where little or no corporate tax is being paid. In order to provide governments with the necessary domestic and international instruments to prevent companies from paying limited amounts of taxes, the Organisation for Economic Co-operation and Development (“OECD”) formulated the BEPS Action Plan at the request of the G20. The BEPS Action Plan consists of 15 Action Points with the objective of minimising or eliminating transactions that erode or decrease a MNE’s tax base by routing its profits from high tax jurisdictions to low tax jurisdictions. The overriding concept of the BEPS Action Plan is that all taxable profits should be taxed once. Among the 15 Action Points addressed in the BEPS Action Plan, Action 13 which provides guidance on transfer pricing documentation and Country-by-Country reporting (“CbCR”), provides one of the bigger challenges to taxpayers in terms of transparency and disclosure This approach to transfer pricing documentation provides tax authorities with relevant and accurate information to perform an effective transfer pricing risk analysis.
  • No Thumbnail Available
    Item
    An examination of base erosion and profit shifting exposure for South Africa
    (2016-01-29) Bob, Vanessa
    Base erosion and profit shifting (BEPS) is a key concern in international tax. In 2010 the Organization for Economic Co-operation and Development (OECD) was tasked with the study of BEPS. In 2013 the OECD released the study report “Addressing base erosion and profit shifting” emphasising BEPS and the risk for the world’s economies and tax bases. The OECD has been focused on BEPS due to several reasons, namely; increase in globalisation, an ever-changing digital economic environment, mismatches of different countries’ tax legislation and the ease with which intellectual property can be transferred. They has released several documents detailing the risk of BEPS as well as an action plan outlining their aim for the transformation of local and international tax. According to the OECD corporate income taxes, as a percentage of gross domestic product (GDP) is a possible indication of base erosion. In South Africa, the corporate income tax rate as a percentage of GDP has decreased from 7.2 % in 20081 to 5% in 20132. Is this a possible indication of base erosion or profit shifting taking place? Protecting South Africa’s tax base is paramount for future growth of the country and the economy. It is therefore important to identify whether BEPS is a real risk and to determine whether South Africa has adequate legislation in place to protect its tax base. Keywords: Base erosion and profit shifting, BEPS, Organisation for Economic Co-operation and Development, OECD, international tax, transfer pricing, thin capitalisation, treaty abuse, treaty shopping
  • No Thumbnail Available
    Item
  • No Thumbnail Available
    Item
    A simple funds transfer pricing model for a commercial bank
    (2013-08-21) Pushkina, Nataliya
    This thesis addresses the core issue of Funds Transfer Pricing (FTP) that has been brought about by the dynamic nature in the changes in the financial industry. This research has drawn up elements from a systematic historical perspective of how a funds pricing policy has been carried out among the banks. The research has made use of the elements of classical economic theory to formulate a conceptual model that will assist in the understanding of the dynamics of the driving changes in Funds Transfer Prices. In an effort to bridge the theoretical and empirical gap in classical economics and the value chain theory, a simple systematic model was constructed. This model was used to understand the dynamics of future changes in the Funds Transfer Pricing. This was done by first analysing the various components that have influenced the basic elements of the model. The basic elements are the liabilities, assets and the Treasury of banking institutions. The interaction of these elements forms the basis of the Funds Transfer Pricing model that was formulated. Using this model, banking institutions would be able to maximize profits and ensure customer satisfaction at the same time. The simple model proposed handles the problems that are caused by the more complex methods used and offers a practical and simple approach to Funds Transfer Pricing in commercial banks.
  • No Thumbnail Available
    Item
    Prescriptiveness of the South African transfer pricing tax legislation in providing guidance on how to transact at an arm's length price
    (2011-02-25) Manyaka, Puleng Owen
    Transfer pricing is a significant taxation problem facing both tax authorities and multinational enterprises. Tax authorities around the world regulate transfer pricing through tax legislation, which requires that cross-border transactions within multinational enterprises be at arm’s-length. A number of countries in the international community have amended their transfer pricing tax legislation to be prescriptive by including regulations in their legislation on how to transact at arm’slength price. This research study presents an argument that the South African transfer pricing tax legislation is non-prescriptive as it does not have regulations on how to transact at arm’s-length price. With reference to the transfer pricing guidelines issued by the Organisation of Economic Development and Corporation and the experience of the United States of America in the enforcement of transfer pricing, this research study examines whether or not the South African transfer pricing tax legislation should be amended to be prescriptive by including regulations on how to transact at arm’slength price. The research findings reveal that to a certain extent the South African transfer pricing tax legislation is consistent with the transfer pricing guidelines issued by the Organisation of Economic Development and Corporation, but to a certain extent it is not. The research findings also reveal that non-prescriptive legislation has in the past created a problem in certain countries. Furthermore, the research findings reveal through an analysis of the United States of America’s transfer pricing enforcement experience, that prescriptive transfer pricing tax legislation in a tax system has a positive impact. Recommendation is therefore made in this research study that the South African transfer pricing tax legislation should be amended to be prescriptive by including regulations on how to transact at arm’s-length price. viii Keywords of the study: arm’s-length price, arm’s-length principle, income tax, IRS, multinational enterprise, non-prescriptive, OECD, Practice Note 7, prescriptive, SARS, section 31, section 482, South Africa, tax legislation, taxation, tax law, tax authority, transfer pricing, transfer pricing methods, United States of America.
Copyright Ownership Is Guided By The University's

Intellectual Property policy

Students submitting a Thesis or Dissertation must be aware of current copyright issues. Both for the protection of your original work as well as the protection of another's copyrighted work, you should follow all current copyright law.