Base erosion for multi-national corporations

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A major issue related to base erosion for multi-national corporations is transfer pricing methods selected by companies.

1. Why does transfer pricing create a concern for multi-national corporations from an IRS perspective and other governmental perspective (like OECD countries) especially since corporate income tax generates such a small proportion of revenues generated by most governments?

2. Discuss the difference between transaction-based and profit-based methods. Provided an example of each and discuss when the method is appropriate and any limitations that are associated with the method.

3. How do Advance Pricing Agreements (APAs) fit in with transfer pricing issues? Discuss whether APAs are beneficial and what concerns a corporation must consider when deciding whether they want to enter an APA

Reference no: EM13757182

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