Target of transfer pricing tax avoidance

The object of transfer pricing can be tangible assets, such as machine parts and raw materials. It can also be intangible assets, such as technical know-how, patents, copyrights, etc. Transfer pricing tax avoidance usually adopts the following methods: ① Transnational taxpayers transfer the tangible or intangible assets of high-tax countries to branches or subsidiaries of tax havens at artificially low prices, and then sell them at market prices in tax havens, and keep the profits in tax havens, so as to enjoy tax-free preferential treatment or pay taxes at low tax rates in tax havens to avoid the tax burden of high-tax countries. (2) Multinational taxpayers transfer the tangible or intangible assets of country A with high tax rate to the branches or subsidiaries of country B as tax havens, and then the branches or subsidiaries of country B as tax havens artificially raise the price and transfer them to the branches or subsidiaries of country C with high tax rate. In this way, the profits of both A and C are transferred to tax haven B, so as to enjoy tax exemption or pay taxes at a low tax rate, avoid the high tax burden of A and C, and maximize the total profits of multinational taxpayers.