CBDT releases Annual Advance Pricing Agreement report - (01 Sep 2023)
Direct Taxation
The Central Board of Direct Taxes (CBDT) has recently released the fourth and fifth annual APA reports. The reports highlights key data and statistics pertaining to the APA programme. These include sectoral distribution of applicants, nature of transactions covered, transfer pricing methodologies applied etc.The Advance Pricing Agreement (APA) programme of CBDT is one of its foremost initiatives for promoting an investor-friendly and non-adversarial tax regime in India. Since its inception, the Indian APA programme has contributed significantly to the Government of India’s mission of promoting ease of doing business.
The report highlights various achievements of the APA programme in FY 2022-2023. In FY 2022-2023, CBDT recorded the highest ever APA signings in any financial year since the launch of the APA programme, signing a total of 95 APAs.An APA is an agreement between a tax payer and tax authority determining the transfer pricing methods for pricing the tax payer’s international transactions for upcoming years.The Advance Pricing Agreement was launched in 2012 by the Central Board of Direct Taxes to reduce any chances of confusion with regards to the pricing of international transactions through a mutual agreement between the taxpayer and tax authority.APA’s was launched due to increase in number of transfer pricing cases.
CBDT also signed 32 Bilateral Advance Pricing Agreements (BAPAs) in FY 2022-2023 being the maximum number of BAPAs in any financial year till date. This figure is more than double the previous signing record of 13 BAPAs in any financial year. The report also details the country-wise distribution of these applications. The BAPAs were signed as a consequence of entering into Mutual Agreements with India’s treaty partners namely Finland, the UK, the US, Denmark, Singapore, and Japan, showcasing the maturity of India’s relationship with various treaty partners.A record of the largest number of single day signings in the history of the programme was also created with a total of 21 APAs signed on 24th March, 2023. Additionally, signing of the 400th Unilateral Advance Pricing Agreement (UAPA) and the 500th APA were also milestones achieved in this year.
Tags : REPORT RELEASE APA
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