Tax risk tops businesses’ transfer pricing priorities

Fully 75% of businesses identify tax risk management as their top transfer pricing priority according to an EY report  In the Spotlight: a new era of transparency.

Rising from 66% in 2013 the survey of 623 tax and finance executives in 36 countries reflects the impact of global calls for greater tax transparency on the boardroom agenda.

With initiatives such as the OECD’s base erosion and profit shifting project compelling businesses to share more information about their operations businesses that are not prepared to meet new standards will come under increasing pressure to disclose transfer pricing activities. The report found however that 21% of businesses lacked operational readiness to adapt to changing transfer pricing conditions and only 21% are fully compliant with global documentation rules.

While 69% of respondents considered establishing a clear strategy as the best approach to addressing operational issues relating to transfer...