- The new Normative Instruction formally includes transfer pricing elements as part of the process to audit import prices for custom valuation purposes; so far, this intersection has not been expressly stated in legislation.
- It is expected that these regulations could result in increased scrutiny on import prices. Accordingly, taxpayers must be in a position to support the reasonableness of intercompany pricing policies and procedures.
- Brazil’s potential adoption of OECD-oriented transfer pricing in the future will likely increase the necessity of counting on robust and well-documented price-setting processes.
- Gathering facts, aligning teams and revisiting pricing policies is key to anticipating potential questioning from tax authorities, as well as properly responding to potential tax audit processes.
Source EY
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