International Transfer Pricing

17 Pages Posted: 7 Jan 2013

See all articles by Connette Mcmahon

Connette Mcmahon

Fayetteville State University - School of Business and Economics

Aaron Corcelius

Fayetteville State University - School of Business and Economics

Barbara Smith

Fayetteville State University - School of Business and Economics

Date Written: January 4, 2013

Abstract

The goals of transfer pricing are to assign a monetary value to a transfer and to minimize the taxes paid by a company as whole. However, because a single company can now have operations literally around the world, transfer pricing has become a very complicated, costly, and lucrative business strategy. The purpose of this paper is to explore the effects of transfer pricing on both the company, its divisions, as well as the countries involved in the transaction. We will also discuss the consequences of transfer pricing on the bottom line of a company and a country, the tax planning opportunities, the effects on company personnel, and the ethical implications of this practice.

Keywords: corporate taxation, decentralization, ethics, international business, multinational, responsibility centers, transfer pricing

JEL Classification: D01, F23, H21, H25, H73, H87, K34, L11, L14, L2, M4

Suggested Citation

Mcmahon, Connette and Corcelius, Aaron and Smith, Barbara, International Transfer Pricing (January 4, 2013). Available at SSRN: https://ssrn.com/abstract=2196699 or http://dx.doi.org/10.2139/ssrn.2196699

Connette Mcmahon (Contact Author)

Fayetteville State University - School of Business and Economics ( email )

Fayetteville, NC 28301
United States

Aaron Corcelius

Fayetteville State University - School of Business and Economics ( email )

Fayetteville, NC 28301
United States

Barbara Smith

Fayetteville State University - School of Business and Economics ( email )

Fayetteville, NC 28301
United States

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