Toray Industries, Inc., a leading Japanese chemical manufacturer, has reported that it is likely to receive a notice of correction based on transfer pricing issues raised by the Tokyo Regional Taxation Bureau.
Transactions between Toray and its US subsidiaries as well as its French subsidiary in the carbon fiber composite materials business from fiscal years 2003 through 2008 are the subject of the dispute.
The enforcement of this notice would cost Toray JPY5.2bn (USD56m) in additional tax.
Toray has confirmed its belief that it has been paying taxes in a proper manner in accordance with the taxation system of each country and disagrees with the bureau’s likely correction of its transfer pricing policy.
If the company officially receives the notice, it will promptly lodge an objection, and request bilateral consultations from the standpoint of preventing double taxation.
This comprehensive report in our Intelligence Report series examines the global and national landscapes in which companies can use transfer pricing to improve their after-tax returns, including summaries of recent developments in design of the corporate supply train, the usefulness of 'offshore' in international corporate tax planning, and a section covering the spread of DTAAs and CFC laws. It is available in the Lowtax Library at http://www.lowtaxlibrary.com/asp/subs_reports.asp and a description of the report can be seen at http://www.lowtaxlibrary.com/asp/description_report16.aspTags: tax | law | business | transfer pricing | Japan | enforcement | Japan
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