New Delhi: The Central Board of Direct Taxes has signed nine unilateral advance pricing agreements (APAs) in July with Indian taxpayers as it looks to reduce litigation by providing certainty in transfer pricing.
The finance ministry in a release said that the APAs signed pertain to diverse sectors like oil and gas exploration, education, banking, pharmaceutical, manufacturing and information technology.
The international transactions covered in these nine APAs include provision of software development services, provision of IT enabled services, provision of engineering design services, distribution, contract manufacturing, etc, the finance ministry said.
With this signing, the number of unilateral APAs signed in the current financial year is 18 and the number of bilateral APAs is one. The total number of APAs signed till date stands at 171. The CBDT expects more APAs to be signed in the near future, the statement added.
The APA scheme was introduced in the Income-Tax Act in 2012 and the 'Rollback' provisions were introduced in 2014. The scheme endeavours to provide certainty to taxpayers in the domain of transfer pricing by specifying the methods of pricing and setting the prices of international transactions in advance.
"The progress of the APA scheme strengthens the Government's commitment to foster a non-adversarial tax regime," the ministry said....