(Li Xiang – China Daily)
Government targets multinationals’ use of transfer-pricing arrangements
China will establish a comprehensive system to monitor foreign companies’ profitability to curb cross-border tax evasion, the State Administration of Taxation said.
The move is one of several steps against tax avoidance taken by the agency to protect the country’s interests as the world’s top destination for foreign direct investment.
The system will allow the agency to acquire profit information on foreign companies so that it can launch “targeted actions” and use information technology to prevent companies from shifting profits overseas, Zhang Zhiyong, deputy director of the SAT, said in an interview with domestic media, which was posted on the agency’s website. Read more here.