Wed, Dec 7, 2016 | updated 06:00 PM IST

CBDT's 'Advance Pricing Agreements' number crosses hundred

Updated: Sep 23, 2016 16:57 IST

New Delhi [India], Sep 23 (ANI): The Central Board of Direct Taxes (CBDT) entered into five unilateral Advance Pricing Agreements (APAs) today, i.e., 23rd September, 2016, with Indian taxpayers.

One of these Agreements has a rollback provision in it. With these signings, the total number of APAs entered into by the CBDT has reached 103.

The APA Scheme was introduced in the Income-tax Act in 2012 and the rollback provisions were introduced in 2014. The scheme endeavors to provide certainty to taxpayers in the domain of transfer pricing by specifying the methods of pricing and determining the arm's length price of international transactions in advance for a maximum period of five future years.

Further, the taxpayer has the option to rollback the APA for four preceding years. Since its inception, the APA scheme has attracted tremendous interest among Multi National Enterprises (MNEs) and more than 700 applications (both unilateral and bilateral) have been filed in just four years.

The five APAs signed today pertain to diverse sectors, i.e., Information Technology, sourcing services and Investment advisory services. The 103 APAs signed so far include 4 bilateral APAs and 99 unilateral APAs. A total of 39 APAs have already been concluded in six months of the current financial year.

The CBDT expects more APAs to be concluded and signed in the near future. The progress of the APA scheme strengthens the government's commitment to foster a non-adversarial tax regime. The approach and functioning of the officers in the APA teams have been appreciated and acknowledged by the industry in India and abroad. (ANI)