Page 1 - Newsletter (Indonesia Adopts CbC Reporting and New Transfer Pricing Documentation Requirements)
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DDTC Tax Newsletter 01  I  Jan 2017

          Indonesia Adopts

          CbC Reporting and

          New Transfer Pricing

          Documentation Requirements

          Introduction                                         reporting  and  its  corresponding  updates  to  transfer

                                                               pricing  documentation  requirements.  MoF  213/2016
            Since the release of the OECD final reports on Action   brings clarity to the transfer pricing documentation legal
          Plan  on  BEPS  in  2015,  including  Action  13  regarding   framework.  Previously,  transfer  pricing  documentation
          guidance  on  transfer  pricing  documentation  and   requirements are only regulated by way of Directorate
          country-by  country  (“CbC”)  reporting,  many  countries   General  of  Tax  (“DGT”)  Regulations,  which  is  not
          have reacted  through draft or  enacted  legislation.  CbC   mandated directly by the Law.
          reporting is part of the minimum standard in the Action
                                                               Documentation Requirements and
          Plan  on BEPS  that  has been agreed  to by G20/OECD
          member countries for consistent implementation in each   Reporting Taxpayers
          country. Under the standard, a multinational enterprise
          (“MNE”) group that meets a certain revenue threshold is
                                                                  MoF  213/2016  distinguishes  3  types  of  transfer
          required to file a CbC report consisting of tax jurisdiction-
                                                               pricing documentations:
          wide  information  relating  to  the  global  allocation  of
          the income, the taxes paid and certain indicators of the   1.  A “master file” that consist of high level information
          location  of  economic  activity  among  tax  jurisdiction  in   concerning  the  MNE  group  global  operations  and
          which the MNE group operates.                           transfer pricing policies;
                                                               2.  A  “local  file”  that  consist  of  information  regarding
            As  part  of  Indonesia’s  commitment  to  the
                                                                  the  taxpayer  specific  business  operations,  financial
          implementation  of  the  standard,  the  Ministry  of
                                                                  information  and  affiliated  transactions,  including
          Finance  released  on  30  December  2016,  Minister  of
                                                                  the transfer pricing analysis of the covered affiliated
          Finance  Regulation  No.  PMK-213/PMK.03/2016  (“MoF
                                                                  transactions; and
          213/2016”),  the  much-anticipated  regulations  on  CbC
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