Summary:
Under China’s current tax and customs management system, enterprises may face the problem of being questioned and adjusting import related prices by the two departments at the same time. On May 18, 2022, Shenzhen Taxation Bureau and Shenzhen Customs issued the notice of Shenzhen customs, State Administration of Taxation and Shenzhen Taxation Bureau on matters related to the implementation of coordinated management of transfer pricing of related imported goods (“notice”), which took the lead in implementing the coordinated management of transfer pricing of related imported goods in the form of cross departmental cooperation. The introduction of this system has solved the problem of double price recognition and repeated taxation between customs and taxation for related import transactions, which has plagued enterprises for a long time, and further brought certainty to the transfer pricing management of enterprises. It is a landmark innovation measure in China and even the world.
At the same time, KPMG China has the honor to assist a foreign-funded enterprise in Shenzhen to successfully reach China’s first case of transfer pricing collaborative management with Shenzhen Customs and Shenzhen Taxation Bureau, which provides a useful practical sample for the feasibility demonstration, policy formulation and specific implementation of the collaborative management system, solves many problems in import related price management that have plagued the enterprise for many years, and reduces the tax compliance cost of the enterprise. As the first and only representatives of the Customs Administration of China to sign the pricing mechanism, the three parties were invited to participate in the ceremony.
