Two expected results of the CbC reporting template are increased transfer pricing-related disputes with taxing authorities and the incidence of double taxation especially if the OECD's other transfer pricing BEPs action plan changes are adopted in final form. Many believe these changes will cause an erosion of the longstanding arm's-length transfer pricing principles by some of the more aggressive tax authorities. The focus of transfer pricing audits would therefore shift to an MNE providing information on its global value chain and its allocation of income, economic activity, and taxes paid among countries that may be unrelated to the specific transfer pricing arrangement. Ultimately, this could lead to more cross-border disputes and without adequate dispute resolution competent authority rules, increased double taxation could be a very costly result.
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