THE Fiji Revenue and Customs Authority has issued guidelines on the transfer pricing amendments which came into force on January 1 this year.
Chief executive Jitoko Tikolevu said the guidelines were intended to provide an overview of the framework within which the transfer pricing rules operated.
"Transfer pricing has become one of the most important international tax issues around the globe and it is therefore timely that Fiji should be addressing this," he said.
"Transfer pricing rules apply to all sectors of the economy involving international transactions between associated parties.
"The transfer prices adopted by a multinational enterprise have a direct impact on the profit it derives in each country in which it has operations. If too little or too much is paid for the transfer of goods and services, the income will be understated. As a result the host country will not be getting its fair share of the total tax take," Mr Tikolevu said.
FRCA has adopted the positions outlined in the Organisation for Economic Co-operation and Development (OECD) Transfer Pricing guidelines for Multinational Enterprises and Tax Administrations and proposed to follow these guidelines in administering Fiji's transfer pricing rules.
Consequently, these guidelines would supplement the OECD guidelines, rather than supersede them, Mr Tikolevu said.
"The principal reason why FRCA has drafted its own guidelines is to provide practical local Fiji focus on issues. This also assists in explaining transfer pricing in a way that is more accessible to taxpayers and advisers dealing with transfer pricing issues than the OECD guidelines.
"FRCA intends to run a number of seminars on the guidelines and will publish details when they become available. The seminars will be at various centres across the country," Mr Tikolevu said.