Due Week 8 and worth 320 points
Transfer pricing is probably one of the biggest tax issues facing taxing authorities . Transfer pricing involves allocating revenues and costs between countries in order to create the best possible tax situation for a multinational company . For this assignment , you will be required to respond to the following scenario :
A multinational company has hired you as its tax professional to advise the company on how to use transfer pricing to avoid or mitigate taxes . This company manufactures and sells cars in the U . S . and two ( 2 ) foreign countries .
Using the Internet or Strayer Library , research the rules and techniques for transfer pricing . Choose two foreign countries and research their respective tax rates .
Write a six to eight ( 6-8 ) page paper in which you :
1 . Based on your research , create projections of revenues , costs , and tax rates for all three ( 3 ) countries , including the U . S . Provide support for your projections .
2 . Based on your projections , create at least two ( 2 ) scenarios in which you allocate revenues and costs to each country to determine the lowest possible overall tax for each country . Provide support for your rationale .