The process of arriving at the fair value of products and services exchanged between connected organisations within a multinational corporation is known as transfer pricing (MNC). The significance of transfer pricing increases during recessions as companies try to manage their tax liabilities and maximise their cash flows. This blog post will examine how MNCs might survive economic downturns using transfer pricing.
To sum up, transfer pricing is a crucial tool for MNCs to use during economic downturns. MNCs can lower their tax obligations, enhance cash flows, lower the risk of tax audits, optimise their supply chains, and promote transparency by making sure their transfer pricing complies with local legislation and accurately reflects the true value of the transactions. In order to manage their tax and business risks during these trying times, MNCs should make sure they have solid transfer pricing strategies in place.
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