Tag: Customs costs
Import duties, tariffs, and border charges that affect the comparability of intercompany prices. Tax authorities challenge whether customs costs are properly excluded or adjusted when applying resale-price or cost-based methods, since their inclusion can distort arm’s length margins and transfer prices.
Brazil vs Pfizer Ltda, October 2018, CARF, Case No 1201-002.628
Pfizer Ltda disputed the Brazilian tax authority's application of the PRL 60% resale price method, which required freight, insurance, and customs costs borne by the importer to be added when determining an arm's length import price under Normative Ruling No. 243 of 2002. Brazil's CARF ruled in favour of the tax authority in October 2018, confirming the inclusion of those additional costs in the PRL calculation ... Read more