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Development of new scientific and methodological
approaches to the process of tax control under transfer
pricing
Olga GIMRANOVA
1
Yeoju Technical Institute in Tashkent
ARTICLE INFO
ABSTRACT
Article history:
Received January 2021
Received in revised form
30 January 2022
Accepted 20 February 2022
Available online
15 March 2022
The article deals with the development of new scientific and
methodological approaches to the process of tax control in
transfer pricing for the implementation of a comprehensive
state tax policy. Proper formation of a transfer pricing system
will allow acquiring the necessary control over the process,
developing operational solutions, identifying opportunities,
deviations and trends in relation to individual transactions and
larger transactions for them.
2181-
1415/©
2022 in Science LLC.
https://doi.org/10.47689/2181-1415-vol3-iss2/S-pp
This is an open access article under the Attribution 4.0 International
(CC BY 4.0) license (https://creativecommons.org/licenses/by/4.0/deed.ru)
Keywords:
economic instability,
mobilization,
controlled transactions,
tax incentives,
transfer pricing.
Transfer narxlarining soliq nazorati jarayonida yangi
ilmiy-metodologik yondashuvlarini ishlab chiqish
ANNOTATSIYA
Kalit so‘zlar
:
iqtisodiy beqarorlik,
mobilizatsiya,
nazorat qilinadigan
operatsiyalar,
soliq imtiyozlari,
transfer narxlari.
Maqolada kompleks davlat soliq siyosatini amalga oshirish
uchun transfer narxlarida soliq nazorati jarayoniga yangi ilmiy-
uslubiy yondashuvlarni ishlab chiqish haqida so‘z boradi.
Transfer bahosini shakllantirish tizimini to‘g‘ri namoyon qilish
jarayon ustidan zarur nazoratni olish, tezkor yechimlarni ishlab
chiqish, individual operatsiyalar va ular uchun kattaroq operat-
siyalarga nisbatan imkoniyatlar, og‘ishlar va tendensiyalarni
aniqlash imkonini beradi.
1
Senior Lecturer, Department of Tourism, Yeoju Technical Institute in Tashkent. Tashkent, Uzbekistan.
Жамият
ва
инновациялар
–
Общество
и
инновации
–
Society and innovations
Special Issue
–
02 (2022) / ISSN 2181-1415
319
Разработки новых научно
-
методологических подходов
к процессу налогового контроля при трансфертном
ценообразовании
АННОТАЦИЯ
Ключевые слова:
экономическая
нестабильность,
мобилизация,
контролируемые сделки,
налоговые льготы,
трансфертное
ценообразование.
В статье рассмотрены вопросы разработки новых
научно
-
методологических подходов к процессу налогового
контроля при трансфертном ценообразовании по
реализации комплексной государственной налоговой
политики.
Грамотное
формирование
системы
трансфертного ценообразования
позволит приобрести
необходимый контроль над процессом, разработать
оперативные решения, выявить возможности, отклонения
и тренды в отношении отдельных транзакций и более
крупных операций по ним.
INTRODUCTION
To ensure the socio-economic development of the state in modern conditions of
economic instability, it is necessary to implement a comprehensive state tax policy, one
of the urgent tasks of which is the need to develop new scientific and methodological
approaches to the process of tax control as a mechanism for mobilizing budget revenues
at all levels.
Tax control is the activity of authorized bodies to control compliance by taxpayers,
tax agents and payers of fees with the legislation on taxes and fees in the manner
established by the Tax Code of the Republic of Uzbekistan [1].
In general, the activities of the tax authorities should be focused on creating a
perfect taxation system and achieving a level of tax discipline that excludes or minimizes
violations of tax laws. Thus, tax control should be aimed at preventing tax evasion, as well
as at identifying and withdrawing arrears in taxes and fees to the budget system.
From January 1, 2022, the provisions of Section VI
“
Tax control in transfer pricing
”
of the Tax Code of the Republic of Uzbekistan (hereinafter
–
“
TC RUz
”
) come into force.
LITERATURE REVIEW
In modern economic literature, there are many works devoted to various aspects
of transfer pricing, the totality of which can be divided into two groups.
The first group of studies includes purely theoretical works devoted to the analysis
of the use of transfer prices in the system of intercompany relations. The work of this
group is mainly devoted to modeling company structures in order to identify universal
dependencies between the level of transfer prices, allowing to maximize the total profit,
and various internal and external factors. The most striking are the works of such foreign
economists as J. Hirschleifer, R. Vansil, R. Kaplan, D. Dietman, S. Emmanuel, L. Eden,
T. Itagaki, G. Holstrum, I. Sauls, S. Tisdel, Dreben A., Edward J. et al. The main advantage of
these studies is the consideration of many factors that may affect transfer pricing. In later
theoretical works, conclusions are drawn on the basis of complex mathematical
calculations with the introduction of a large number of restrictions and simplifying
assumptions. However, often these studies do not refer to empirical data at all.
Жамият
ва
инновациялар
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Общество
и
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Society and innovations
Special Issue
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02 (2022) / ISSN 2181-1415
320
The second group of works on transfer pricing includes empirical studies of the
application of various transfer pricing methods, in which conclusions are drawn based on
the analysis of data obtained by questioning companies. Among the empirical works, the
works of such foreign researchers as Eccles R., Spicer B., Adler R., Dean J., Borkowski S.,
Grannotover M., Thompson J. can be especially distinguished. Basically, this group of
researchers was engaged in identifying groups of factors affecting choice of transfer
pricing method.
Despite the obvious relevance of the problem of transfer pricing, in the domestic
literature there are only a few examples of fundamental studies that consider transfer
prices as one of the tools to increase the efficiency of the intra-company mechanism.
As an example, we can cite the works of N.I. Mnogolet, A.A. Porokhovsky, V.Yu. Pashkus,
A.S. Pleshchinsky, A.A. Zaikin, D. Kasatkin
At the same time, most other domestic researchers are interested in transfer
pricing in the light of the problems of tax optimization using intra-company settlement
prices without conducting the necessary, in the author's opinion, comprehensive
analysis, including both the study of the nature of transfer pricing, the scope of its
distribution, and state regulation in this area. directly affecting the practice of
application.
It should be noted that the problem of establishing intra-company prices is closest
to the range of issues of the theory of transaction costs, however, in the latter there is
insufficient knowledge of the nature.
RESEARCH METHODOLOGY
To achieve the goal of the study, the following general scientific methods were
applied: observation, analysis, synthesis, comparison, historical method, grouping,
induction, deduction. In addition, the author used special scientific methods of micro- and
macroanalysis, economic-statistical and graphical methods.
METHODS AND ANALYZING
All transactions between related parties are controlled for transfer price
regulation. In this case, the tax authorities have the right to compare the prices applied
by the taxpayers with the market prices and to charge additional taxes in case of
deviations from the market prices.
Transfer price is a price that is formed in transactions between related parties and
(or) differs from an objectively formed price that would be applied in comparable
economic conditions in transactions between independent parties.
The grounds for recognizing persons as related for tax purposes are given in
Article 37 of the Tax Code of the Republic of Uzbekistan.
Chapter 21 of the Tax Code of the Republic of Uzbekistan specifies the criteria for
recognizing transactions as controlled for tax purposes, a brief description of which,
indicating threshold values for the amount of income for the corresponding calendar
year, is presented in the table below:
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321
Table 1.
Controlled transactions between residents of the Republic of Uzbekistan for the
application of benefits and proper accounting [2].
Controlled transactions
Annual turnover limits for
recognizing a transaction as
controlled
Transactions between residents of the Republic of Uzbekistan
Transactions between related parties
5 billion soums
(approximately 406 thousand
euros)
Transactions between related parties in which at least one of the
parties to the transaction applies a special tax regime or is a member
of a special economic zone*
500 million soums
(approximately 40 thousand
euros)
Transactions between related parties in which at least one of the
parties to the transaction is exempt from paying income tax, applies a
reduced tax rate or other tax benefits**
500 million soums
(approximately 40 thousand
euros)
Foreign trade transactions
Transactions with foreign related parties
no threshold
Transactions in the field of foreign trade in goods of world exchange
trade with foreign independent persons
no threshold
Transactions of all payers with residents of offshore zones
no threshold
*At the same time, among the other parties to this transaction there is a person who
does not apply special tax regimes
** At the same time, among the other parties to this transaction there is a person who
is not exempt from paying such a tax and does not apply benefits
With the introduction of tax control on transfer pricing, taxpayers are required to
submit notifications of controlled transactions to the tax authorities in the prescribed
form. This notice must be provided to the tax authorities no later than the deadline for
submitting annual financial statements for the calendar year in which controlled
transactions were made. The content of the notification of controlled transactions must
comply with the requirements of Article 182 of the Tax Code of the Republic of
Uzbekistan. The notification must be submitted in the form and in the manner approved
by the State Tax Committee of the Republic of Uzbekistan in agreement with the Ministry
of Finance of the Republic of Uzbekistan.
In the event that the tax authorities request documentation on transfer pricing of a
controlled transaction, taxpayers are required to provide documentation in accordance
with the requirements of Article 193 of the Tax Code of the Republic of Uzbekistan within
30 calendar days from the date of the request.
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Penalties for non-payment or incomplete payment of taxes in the Republic of
Uzbekistan as a result of the application of tax control measures for shopping centers are
set at 40% of the unpaid tax amount.
In connection with the above, when concluding controlled transactions with
related parties, it is necessary to comply with the transfer price formation rules, which
should be set at a level that maximizes the Bank's profit, as well as comply with tax
legislation [3].
Increasing tax attention to company-to-company transactions, as well as the
complexity of legislation in various jurisdictions, make transfer pricing for international
companies one of the most important issues in risk management [4].
CONCLUSION
The provision of transfer pricing services is ranked first in the region and is well
positioned to assist companies in the process of planning a transfer pricing strategy and
preparing documentation, as well as assisting in the conclusion of preliminary pricing
agreements or in resolving possible disputes.
Companies
’
tax departments often encounter conflicting transfer pricing data from
their departments. This can significantly complicate business operations, increase
workload, and potentially lead to problems at the end of the quarter or year when
submitting reports that distort information.
If banks or companies carry out large intra-group transactions, face inconsistent or
unpredictable transfer pricing results that impose complex information search
requirements or make it difficult to predict the effective tax rate, the developed
methodology that we propose to introduce new tools and processes for the ERP system.
During the study, we developed a program that is structured, platform
independent and provides the ability to effectively manage transfer pricing systems,
providing maximum business benefits and minimizing risks.
Proper formation of a transfer pricing system will allow you to acquire the
necessary control over the process, develop operational decisions, identify opportunities,
deviations and trends in relation to individual transactions and larger transfer pricing
operations.
REFERENCES:
1.
Valeeva A.V. Abstract for a PhD degree on the topic: Improving tax control over
transfer pricing. Moscow 2011.
2.
M.Zh. Temirkhanova, improving accounting and tax accounting and reporting in
travel companies in the Republic of Uzbekistan
–
Improving the tax policy of the state in a
globalizing economy. Tambov, May 15, 2014.
–
PP. 267
–
275.
3.
Pricing: special issues (T. Kosheleva, April 4, 2014).
4.
Temirkhanova M.Zh. Organization of accounting obligations in a travel company.
Economy and entrepreneurship. 2016.
–
No. 11-2 (76).
–
PP. 879
–
882.
